Two North Carolina Courts have held within two months that the Bankruptcy Clause doesn’t demand ‘financial distress’ to establish subject matter jurisdiction.
Bankruptcy Judge Russin declines to follow the Third Circuit and adopts the conclusion of bankruptcy courts holding that Sub S status is estate property.
Bound by the Third Circuit’s first LTL decision, the bankruptcy court found that LTL’s rejiggered second filing suffered from the same defect: no immediate financial distress.
The Fourth Circuit majority upheld a preliminary injunction barring tort suits against a debtor’s nonbankrupt affiliates following a Texas divisional merger.
