BankruptcyProf Blog

Madoff Son Must Face Suit in Bankruptcy Court

"Bernard Madoff’s son Andrew must submit to a bankruptcy judge’s decision to permit a $198 million lawsuit to go forward because he sought that court’s protection when he filed a claim against his father’s estate, a federal judge said.

U.S. District Judge William Pauley in Manhattan last week declined to hear an appeal of the September decision in favor of Irving Picard, the trustee liquidating Bernard L. Madoff Investment Securities LLC, in his claim against Madoff family members including Andrew Madoff and the estate of Mark Madoff, who committed suicide in December 2010. Pauley’s written opinion was filed today in U.S. Bankruptcy Court in Manhattan.

'Because Mark and Andrew invoked the aid of the bankruptcy court by offering a proof of claim and demanding its allowance, they must abide by the consequences of that procedure,' Pauley said in his Dec. 22 decision, citing a U.S. Supreme Court ruling that also described limits to the power of bankruptcy judges."

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'Basketball Wives' Star Sued for Helping Blow NBA Star's Fortune

"Evelyn Lozada -- one of the stars of 'Basketball Wives' who was once engaged to former NBA All-Star Antoine Walker -- is being sued for allegedly receiving hundreds of thousands of dollars illegally.

The story is shocking.  Walker raked in a whopping $110 million during his NBA career, in addition to untold millions in endorsements and other deals ... and he blew ALL OF IT and a lot more.

Walker filed for bankruptcy last year, and now the bankruptcy trustee smells a rat.  It seems Walker gave Lozada $560,000 when he already knew he was going belly up.  The trustee has sued Lozada, claiming the transfer was fraudulent -- an attempt to hide money from legitimate creditors."

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Rapper Young Buck faces losing his trademarked name in bankruptcy case in Nashville

"Multiplatinum rapper Young Buck could lose his name and other assets in a bankruptcy case that the rapper says is frustrating his attempts to sign with a new record label.

Davidson County Bankruptcy Judge George Paine converted the artist’s bankruptcy from Chapter 11 reorganization to Chapter 7 liquidation this week.

The trustee administering his estate has said she plans to sell the trademarked 'Young Buck' name along with other assets. Buck, whose real name is David Darnell Brown, told The Tennessean he was close to signing a recording deal with New Orleans-based Cash Money Records."

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Hostess filing in mix?

"Hostess Brands, America’s biggest bakery, is on the verge of filing for bankruptcy again — perhaps as early as next month, The Post has learned.

Staying out of Chapter 11 is proving tough for the Twinkies maker, a source said, adding the question now is whether it will be a pre-packaged bankruptcy or not."

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Over Trustee's Objections, Former Howrey Bankruptcy Counsel to be Paid in Full

"In a single declarative sentence, U.S. bankruptcy court judge Dennis Montali captured the essence of what was at issue during a nearly two-hour hearing Wednesday over professional fee applications in the Howrey bankruptcy: 'This is not an ATM machine.'

That observation notwithstanding, the Howrey estate spit out fees in abundance as the sometimes contentious hearing came to a close. Wiley Rein collected one of the largest sums, with Montali approving the full $1.03 million the firm requested for its work as debtor's counsel in the Howrey case from June to October.

By way of background: Howrey entered involuntary Chapter 7 bankruptcy in San Francisco in April, less a month after dissolving. The case was converted to a Chapter 11 proceeding in June; at the urging of the estate's largest creditor, Citibank, it got put in the hands of Chapter 11 trustee Allan Diamond of Diamond McCarthy in October."

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American Laser Centers files for chapter 11

"American Laser Centers LLC has filed for bankruptcy protection along with its parent, as a weak economy dampened demand for its laser hair removal treatments leading to cash constraints, court documents showed."

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Mo. firms seek involuntary bankruptcy for Mamtek

"A Missouri bank has joined with four companies seeking to force a failed artificial sweetener factory in Moberly into an involuntary bankruptcy case."

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Round Table wraps up restructuring, emerges from bankruptcy

"Round Table Pizza Inc. said Friday it is expected to emerge from bankruptcy next week.
 
The company filed for Chapter 11 protection in February with the U.S. Bankruptcy Court in Oakland. Its reorganization plan was approved Dec. 12."

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Scottsdale Owners of 54 Arby's File for Chapter 11 Bankruptcy

​"The slogan 'It's Good Mood Food' doesn't appear to be case with several Arby's restaurants in Arizona. In fact, the mood's downright depressing.

The Republic reports three related Scottsdale limited-liability companies, all led by Scottsdale businessman Charles Harmon, that operate 54 Arby's fast-food restaurants in Arizona and one in New Mexico, have filed for Chapter 11 bankruptcy protection."

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Wall St. seeks dismissal of Ala. record bankruptcy

"Wall Street creditors asked a judge Thursday to throw out the record bankruptcy filed by Alabama's largest county over more than $4 billion in debt, arguing state law doesn't allow it."

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American Airlines' $30 million London town house

"Buried deep in American Airlines' Chapter 11 bankruptcy filing is a striking asset -- a town house in one of London's most expensive residential streets that property experts say could be worth up to $30 million."

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UC Irvine Announces Better Clerkship Numbers Than Almost Everyone Else

Thank you to the Hon. Scott Clarkson for the lead on this:

"UC Irvine Announces Better Clerkship Numbers Than Almost Everyone Else" By Christopher Danzing 

Read the article here.

United States Bankruptcy Court - Central District of California
Santa Ana, CA

Two more bankruptcy preparers facing possible criminal contempt charges

"Cases against two additional bankruptcy petition preparers are being sent to the U.S. Attorneys Office, bringing to four the number of criminal contempt cases against preparers under review by federal prosecutors.

Cases against Jennifer Valente Abbott, a disbarred attorney, and Gaynor Morrison, who had prepared bankruptcy petitions for the now defunct Credit University, were sent to the prosecutors last week by U.S. District Court Judge J.P. Stadtmueller. Each were cited for contempt by bankruptcy court judges who, in accordance with judicial protocal, sent the case up to district court for possible criminal action."

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AMR Record $4.1 Billion Bankruptcy Cash Mutes Takeover Risk

"AMR Corp.'s $4.1 billion in cash, the most ever for a U.S. carrier entering bankruptcy, may help the parent of American Airlines preserve its independence.

Filing for Chapter 11 with that much in cash and short-term investments strengthened the third-largest U.S. airline company's control over its fate, unlike peers that restructured in the last decade, said James M. Higgins, an analyst at New York-based Ticonderoga Securities LLC."

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T-Boz: CrazySexyBankrupt

"T-Boz ain't too proud to beg -- just like TLC sang back in the 90s -- because she's filed for bankruptcy.

According to docs filed last month in U.S. Bankruptcy Court, T-Boz (real name Tionne Watkins) found herself owing creditors $768,642.99 -- mostly from mortgages on her $1.2 million house.

The docs don't paint a picture of exorbitant spending -- she takes in $11,700/month in income, with monthly expenses totaling $8,821."

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Louis Freeh, Former FBI Director, Appointed Trustee In MF Global Bankruptcy Case

"Former FBI director Louis Freeh was appointed trustee in the MF Global (MFGLQ.PK) bankruptcy case on Friday, days after he was hired to lead an independent probe into a sex abuse scandal at Penn State University.

Freeh, also a former judge, was appointed by the United States trustee for the region, according to a court document. The move is subject to court approval.

MF Global filed for bankruptcy protection on October 31, after $6.3 billion in risky bets on European sovereign debt spooked investors and an attempt to sell the firm failed."

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Tobey Maguire, others settle over poker winnings

"Tobey Maguire has decided to fold 'em and settle a lawsuit over his winnings from a convicted con man during high-stakes Hollywood poker games.

The 'Spider-Man' star agreed to pay $80,000 to settle the lawsuit filed over more than $311,000 he was paid by a convicted Ponzi scheme operator in Texas Hold 'Em matches that included celebrities, businessmen and others, court documents state.

If approved by a judge next month, Maguire will pay the money to a bankruptcy trustee who is trying to recoup money that former hedge fund operator Bradley Ruderman bilked from investors to finance his lavish lifestyle."

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Judge rejects Las Vegas Monorail budget plan

"A federal judge has rejected the Las Vegas Monorail's plan for financial solvency.

The Las Vegas Review-Journal reports that U.S. Bankruptcy Court Judge Bruce Markell rejected Friday the monorail's plan to exit Chapter 11 bankruptcy because the terms 'doom it to failure.' "

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Jefferson County bankruptcy: Sewer receiver John Young's role to be focus of hearing today

"The pivotal arguments on court-appointed receiver John S. Young's future are set for today in Jefferson County's bankruptcy case, arguments some legal experts say are eventually destined for the U.S. Supreme Court."

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Dallas Stars win OK for bankruptcy plan, team sale

"The Dallas Stars hockey team won court approval of its bankruptcy reorganization, clearing the way for the team to be sold for $265 million to Vancouver businessman Tom Gaglardi.

U.S. Bankruptcy Judge Peter Walsh approved the plan at a hearing on Friday, court records show."

Read more here.