BankruptcyProf Blog

Hussey Copper files for bankruptcy protection

"Hussey Copper of Leetsdale has filed for bankruptcy and has a letter of intent with a potential buyer.

The action comes after the 163-year-old copper producer defaulted on a loan agreement with PNC Bank and other lenders and failed to find other backers to refinance its debt."

Read more here.

Friendly's Bankruptcy Filing Imminent, Says Report

"Friendly's is on the verge of bankruptcy, according to a report from the Wall Street Journal. The ice cream and casual dining chain will apparently file for Chapter 11 protection as early as next week. The Journal reports that the over 500 Friendly's location will likely remain open during bankruptcy proceedings, with the help of a $75 million financing deal with Wells Fargo bank."

Read more here.

Kodak Debt Swaps Soar as Camera Maker Said to Weigh Bankruptcy

"The cost to protect Eastman Kodak Co. (EK)’s debt from default jumped as the unprofitable 131-year-old camera maker is said to be weighing options including a bankruptcy filing.

Credit-default swaps linked to the Rochester, New York-based company rose 4 percentage points to 66.5 percent upfront, according to data provider CMA. That means investors would pay $6.65 million initially and $500,000 annually to protect $10 million of Kodak’s debt for five years.

Kodak may seek bankruptcy protection because of concerns raised by possible bidders for its patent portfolio, said three people with direct knowledge of the process. Some potential buyers of the patents are reluctant to proceed with bids because a purchase may amount to a so-called fraudulent transfer if Kodak becomes insolvent, said the people, who asked not to be named because the talks are private."

Read more here.

Dodgers Fans to McCourt: Show Us the Money In Bankruptcy Court!!

"Los Angeles Dodgers season ticket holders want to make sure Frank McCourt isn't screwing them over in the team's bankruptcy proceedings -- and they've filed a motion to make sure they're protected.

Attorneys representing a handful of season ticket holders filed docs with the bankruptcy court in Delaware ...seeking to establish a formal committee of more than 17,000 season ticket holders.

According to the docs, the committee's goal is to make sure Dodger funds are going to what they consider the most important part of the 'fan experience' -- such as acquiring new players, meeting payroll, renovating the stadium, and operating concessions.

Interestingly, the motion makes no mention of stadium security -- which is what everyone's been talking about since the Opening Day beating of Giants fan Bryan Stow."

Read more here.

Deloitte sued for $7.6B in mortgage fraud case

"A pair of lawsuits filed Monday claim that Deloitte & Touche LLP, one of the nation's largest accounting firms, should pay $7.6 billion in damages for failing through years of audits to detect massive fraud at a now-defunct Florida mortgage company.

'They certainly did not do their job,' said attorney Steven Thomas, who represents those suing Deloitte. 'This is one of those cases where the red flags are staring you in the face, and you've got to do a lot, and they did not.'

Deloitte spokesman Jonathan Gandal responded that the company rejects the claims, calling them 'utterly without merit.'

The lawsuits were filed in Miami-Dade Circuit Court on behalf of the bankruptcy trustee for the fraudulent mortgage firm, Taylor Bean & Whitaker, and by Ocala Funding LLC, a company that purchased hundreds of millions of dollars' worth of mortgages from Taylor Bean. The bankruptcy trustee is attempting to recover money for Taylor Bean creditors."

Read more here.

Solyndra cleared for October 27 bankruptcy auction

"Solar panel maker Solyndra LLC, which filed for bankruptcy after borrowing $535 million from the U.S. government, on Tuesday was cleared to begin a quick sale process that some creditors criticized as 'rushed.'

U.S. Bankruptcy Judge Mary Walrath in Delaware approved the plan for an October 27 auction of the business, citing the support for the plan by the Department of Energy (DOE). She also directed the company to attend a major trade show next month to find a buyer for the business."

Read more here.

Dodgers fight MLB request for control of team

"The Los Angeles Dodgers fought back against Major League Baseball's attempt to wrest control of the bankrupt baseball team from Frank McCourt, asking a federal court to delay considering the league's requests to sell the team and throw out its lawyers.

The team, which filed for bankruptcy in June, wants to move forward with its own plans to hold an auction of its broadcast rights next month. The auction is expected to help refinance the team and allow McCourt to hold onto it after bankruptcy.

MLB has disputed the team's need for bankruptcy and questioned McCourt's personal interests and spending. The league filed documents with the court last week asking to present its own plan for the team, most likely a quick sale."

Read more here.

Deed of Trust Assignment and Sale Issues

From: Stanley J. Kartchner
Sender: Bankruptcy law discussion list
To: BANKR-L@LISTSERV.ILLINOIS.EDU
ReplyTo: Stanley J. Kartchner
Subject: deed of trust assignment and sale issues
Sent: Sep 23, 2011 7:51 AM

For those following developments in the area of deed of trust sales occurring without a recorded transfer of the beneficial interest, here is an article about the oral arguments yesterday before the Arizona Supreme Court (highest court in Arizona) addressing two related questions certified by bankruptcy judge Eileen Hollowell in adversary no. 4:10-ap-00727-EWH (Arizona). Although the questions deal with a specific Arizona statute, the court's ruling will certainly affect many foreclosures in Arizona and could have implications in other jurisdictions as well: http://azstarnet.com/article_64c6ed66-f336-5bfc-972e-65740509e6cd.html Stanley J. Kartchner Chapter 7 Trustee 7090 N. Oracle Rd. #178-204 Tucson, AZ 85704 520-742-1210 email: trustee@aztrustee.com

Chuck Greenberg interested in Stars bid, lawyer tells court

"Former Texas Rangers CEO Chuck Greenberg is interested in bidding for the bankrupt
Dallas Stars of the National Hockey League, a lawyer said in a Delaware court
Monday, according to a Bloomberg news report.
 
Greenberg is part of Texas Hockey Acquisition Co. and is interested in bidding,
said Greenberg's attorney, Jeffrey M. Schlerf of Fox Rothschild, LLP.
 
U.S. Bankruptcy Judge Peter Walsh agreed to speed up the usual process for
approving an auction, letting the team return to court Sept. 22 to seek auction
rule approval, according to the report."

Read more here.

Solyndra Execs To Plead 5th At House Hearing

"Two top executives at a bankrupt California solar energy company say they will invoke their Fifth Amendment rights and refuse to answer questions when they appear at a House hearing on Friday."

Read more here.

Real Housewives Hubby Joe Giudice Withdraws Bankruptcy Filing

"It looks like Joe Giudice is going to deal with his debts, after all.

At least, that's the impression he's giving.

Nearly a year after Real Housewives of New Jersey reality star Teresa Giudice and her husband both filed for bankruptcy, Joe has decided to withdraw his efforts to wipe his hands clean of millions in liabilities."

Read more here.

Ms. Ps and Qs: Prof. Nancy Rapoport

Ask Ms. Ps and Qs*

By Nancy Rapoport, on September 11th, 2011

Beware the bankruptcy lawyer wanna-bes. My hubby, who's also a lawyer, recently forwarded me an email that began with these two rather optimistic lines: You May Not Have to Refer Your Client to Another Attorney. The Bankruptcy Road Map [W]ill Guide You through Chapter 7 or Chapter 11 Bankruptcy Cases. Yikes! I know that bankruptcy law is trendy these days, and there's a crushing workload for consumer lawyers, given the nation's financial distress. But non-bankruptcy lawyers who think that they can just pick up a book, read it from cover to cover (or worse yet, read just parts of it), and then give competent advice are fooling themselves. Bankruptcy law is an ecosystem. To survive in this ecosystem, a lawyer must understand how the pieces fit together-and not just the bankruptcy law pieces, but also the bankruptcy rules, local rules, and other state and federal law that overlaps with giving competent bankruptcy advice. We have enough problems out there with bad lawyers who do work regularly in bankruptcy law. We don't need wanna-bes mucking things up.

But how can clients (especially those who are already in financial distress) figure out who's going to be a good bankruptcy lawyer and who isn't? There's a part of me that wants to come up with a non-tortious way of stamping "bad" on the foreheads of lawyers who don't know what they're doing and who don't take steps to educate themselves properly.[i]< file:///C:/Users/ClayHmn/Downloads/nacttacademynewcontent91211/MsPsAndQs_9_1 2_11.docx#_edn1>I'd also stamp "bad" on the foreheads of those lawyers who don't take proper care of their clients.[ii]< file:///C:/Users/ClayHmn/Downloads/nacttacademynewcontent91211/MsPsAndQs_9_1 2_11.docx#_edn2>  

On the reasonably well-documented theory that folks who read ethics columns are already on the correct side of the ethics line, here's my plea to you: Make yourselves available to community leaders, so that they get to know you and can recommend you. Speak to community groups about issues in bankruptcy law; write a column for a local newspaper; spend a little bit of time volunteering to do some pro bono work. I know that you know what you're doing when it comes to bankruptcy law. YOU know that you know what you're doing. But clients who have never dealt with the system have no idea how to choose the right lawyer. We all look alike to the non-law-trained eye, at least on paper. And that's scaring me. So, if you don't have time to speak to groups or write a column for the local paper, how about this?  Let's start a checklist that we can pass out to community leaders so that they can help their communities help themselves.

Here's my first cut; let's get your ideas. Five tips for potential clients: how to tell a good lawyer from a not-so-good one 1. If you have access to a computer, go to your state's state bar association page to see if the lawyer you're considering has been disciplined. 1. Find out how long the lawyer has been practicing bankruptcy law. (You might be able to tell from the lawyer's ad or website how long he or she has been doing bankruptcy law; otherwise, it's perfectly ok to call the lawyer's office and ask someone.) 1. If you have friends who have been through bankruptcy recently, ask them what they thought of their lawyers. 1. If you go to the initial consultation with the lawyer, and he or she says any of the following, run away: - "I can help you save your car, your house, your jewelry, and pretty much everything else, no matter how bad your financial condition is." - "You don't need to tell the court about your [insert name of something you really like that you'd hate to lose in a bankruptcy]. That'll be our little secret." - [From a secretary or legal assistant]: "I'm going to fill out all of the paperwork; you're going to sign it; and you'll meet your lawyer after the bankruptcy petition has been filed." - "Don't worry about credit counseling. We can figure that out later." - "I've never lost a case."[iii]< file:///C:/Users/ClayHmn/Downloads/nacttacademynewcontent91211/MsPsAndQs_9_1 2_11.docx#_edn3> 1. Listen to your instincts. If you feel uncomfortable after meeting with the lawyer, even if the lawyer is good, he or she isn't the one for you. What'cha think, readers? Worth a shot? ------------------------------ [i]< file:///C:/Users/ClayHmn/Downloads/nacttacademynewcontent91211/MsPsAndQs_9_1 2_11.docx#_ednref1> On advice of counsel, I'm not doing that. [ii]< file:///C:/Users/ClayHmn/Downloads/nacttacademynewcontent91211/MsPsAndQs_9_1 2_11.docx#_ednref2> For some, I'd run out of forehead with the number of stamps I'd use. [iii]< file:///C:/Users/ClayHmn/Downloads/nacttacademynewcontent91211/MsPsAndQs_9_1 2_11.docx#_ednref3> Even Perry Mason couldn't say that. http://www.answers.com/topic/perry-mason-the-case-of-the-deadly-verdict-tv-e pisode .

*Have a question for Ms. Ps & Qs - Ask her here.*< http://considerchapter13.org/ask-ms-ps-and-qs/> ------------------------------ * * < http://considerchapter13.org/wp-content/uploads/2011/02/Rapoport150.jpg>*Nan cy B. Rapoport*, a/k/a "Ms. Ps & Qs," is the Gordon Silver Professor at the William S. Boyd School of Law, University of Nevada, Las Vegas.

 

Ohio Man Charged With Defrauding Fellow Amish

"An Ohio man has been charged with defrauding fellow Amish out of nearly $17 million by moving their money from safer securities to riskier investments subject to market fluctuations, federal prosecutors said Thursday...The indictment said nearly 2,700 people and entities lost about $16.8 million since 2006....Beachy had promised to put investor money into safer mortgage-backed securities but instead placed the money in stocks, mutual funds and bond funds that had more risk, the indictment said.

A&M Investments filed for bankruptcy protection in June, listing about $33 million in liabilities and nearly $18 million in assets. Members of Mennonite and Amish communities who lost money recently asked a bankruptcy judge to let them settle the matter out of court."

Read more here.

Bankruptcy Among College Grads Grows

"Bankruptcy has gotten more educated over the past five years, as financial distress spread to more of the population with college degrees, according to study results released Tuesday."

Read more here.

Bujak's estranged wife wants separate bankruptcy

"Former Canyon County Prosecutor John Bujak's estranged wife wants to separate her bankruptcy estate from his, the latest twist in the downfall of the southwestern Idaho Republican's political and personal fortunes."

Read more here.

Comeuppance for Harsh Discovery Order?

From: Bankruptcy law discussion list [mailto:BANKR-L@LISTSERV.ILLINOIS.EDU]
On Behalf Of Camp, Bryan
Sent: Tuesday, September 13, 2011 11:07 AM
To: BANKR-L@LISTSERV.ILLINOIS.EDU
Subject: Comeuppance for Harsh Discovery Order?

Hi all,

If y'all recall a recent Order posted on this list from US Dist. Judge Sam
Sparks where he invited counsel to a "kindergarted party" to resolve a
discovery dispute, you may be interested in this story: a reprimand from
Chief Judge Edith Jones. Link here:
http://www.statesman.com/blogs/content/shared-gen/blogs/austin/courts/entrie
s/2011/09/13/judge_sparks_cute_orders_criti.html

Regards, -bryan camp

ANNUAL SUPREME COURT REVIEW

Federal Bar Association - Los Angeles Chapter

September 28, 2011
Time: 12:00 p.m. - 1:30 p.m.
Registration: 11:30

Featuring UCI Law School Dean Erwin Chemerinsky.
Also Featuring Annual Judge Barry Russell Scholarship Awards.

Location: The Biltmore Hotel, 506 S. Grand Ave., Los Angeles, CA

Cost: $75 (FBA Members), $45 (government employees/Clerks/Students)
$90 (non members)

Group Registration Fees: FBA member table of 9 $600; Nonmember table of 9 $700

Federal judiciary receive complimentary admission.

Federal Bar Association - Los Angeles Chapter
210 N. Glenoaks Blvd. Ste C
Burbank, CA 91502
(818) 843-1020   fax: (818) 843-7423
www.fbala.org   email: fbala@emaoffice.com

New Jersey Devils Close To Bankruptcy, According To Report

"The New Jersey Devils have found themselves in financial hot water, according to a report in the New York Post. They're in default on a loan and could be declared bankrupt. Via the Post:

'The attendance-challenged, heavily indebted team missed its Sept. 1 loan payment, giving its lenders a breakaway chance to push the team into bankruptcy, a source with direct knowledge of the situation said.' "

Read more here.

NewPage, Cerberus-Owned Papermaker, Files for Bankruptcy

"NewPage Corp., the largest North American maker of coated papers, filed for bankruptcy six years after being bought by Cerberus Capital Management LP.

NewPage had $3.4 billion in assets and $4.2 billion in debt as of June 30, according to today’s Chapter 11 filing in Wilmington, Delaware. The Miamisburg, Ohio-based company was bought by New York-based Cerberus for $2.3 billion in January 2005, and issued $900 million in junk bonds to fund the purchase. It has been unprofitable since 2006."

Read more here.

Civility in litigation

From: Ayer, John
Sender: Bankruptcy law discussion list
To: BANKR-L@LISTSERV.ILLINOIS.EDU
ReplyTo: Ayer, John
Subject: FW: Civility in litigation.
Sent: Sep 6, 2011 1:42 PM

Students of civility in litigation may want to consider a fascinating blog post by Keith Humphreys, up this morning at /Reality-Based Community/. It's not specifically about litigation, but it includes this snippet:

“One diagnostic of class is being comfortable, and making others comfortable, in any company.” Part of that virtue I think is being merciful towards, even unusually kind to, people who are vulnerable because they have made a mistake. But some people take the reverse approach of blasting and humiliating those who err, maybe out of self-importance (as if to imply that they never make errors themselves) and maybe because they have constant free-floating rage that they discharge at any remotely socially acceptable moment.

http://www.samefacts.com/2011/09/blogging/to-forgive-divine/
==

Also: a favorite boss of mine (sic) liked to say--"Samuel Johnson says the way to judge a man is by how he treats a person who can't do him any good." I'm not sure Johnson said it, though he might well have thought it.

How and to what extent this observation applies to lawyers and judges--is left as an exercise to the student.


Jack Ayer
Professor of Law Emeritus
UC-Davis
http://underbelly-buce.blogspot.com