December 08, 2023

Courts Are Split on Counting Future Rent Toward the $7.5 Million Debt Cap in Sub V

If future liability on unexpired leases and executory contracts is counted, many companies will be ineligible for Subchapter V of chapter 11.

2nd Circuit, New York, New York Southern District

December 04, 2023

A Refinanced Consumer Loan Might Not Be a ‘Consumer Debt,’ Ninth Circuit Says

Refinancing a consumer loan to obtain a lower interest rate might make an individual debtor eligible for chapter 7.

9th Circuit

November 30, 2023

Willful Breach of Contract Doesn’t Result in Section 523(a)(6) Nondischargeability

Without allegations of an intentional tort, a willful breach of contract can’t be nondischargeable as a ‘willful and malicious’ injury.

10th Circuit, Oklahoma, Oklahoma Western District

November 28, 2023

Ninth Circuit: State Law Can’t Require More than What Rule 3001 Requires for Claim Validity

Reversing the BAP, the Ninth Circuit (erroneously) holds that state law cannot demand more documentation for a proof of claim than Bankruptcy Rule 3001 requires for prima facie validity.

9th Circuit

November 22, 2023

Discharge Isn’t an Automatic Bar to Conversion from ‘7’ to ‘13’

A district court opinion from Michigan raises the question of whether the Supreme Court’s decision in Marrama is still good law after Law v. Siegel.

6th Circuit, Michigan, Michigan Eastern District

November 13, 2023

In MOAC on Remand, the Second Circuit Vacates the Order Assigning the Lease

The Second Circuit is remanding to district court for a ruling on the relief available to the landlord, given that the sale closed years ago.

2nd Circuit

November 09, 2023

Setoff Can’t Be Raised as a Defense to Receipt of a Fraudulent Transfer

The Madoff case makes more law: A claim against a bankrupt estate can’t be set off against liability for receipt of a fraudulent transfer because one arose before bankruptcy and the other arose after.

2nd Circuit, New York, New York Southern District

October 25, 2023

Bankruptcy Judge Refuses to Enforce an Arbitration Agreement

An exculpation clause in a chapter 11 plan protected the owner’s counsel from a malpractice suit.

6th Circuit, Ohio, Ohio Southern District

October 19, 2023

State Law Lines Up with Federal Judicial Estoppel When Assets Aren’t Scheduled

Oregon Supreme Court allows substitution of a bankruptcy trustee as the real party in interest because denial would chiefly punish the debtor’s creditors.

9th Circuit, Oregon

October 18, 2023

Bankruptcy Courts Have Statutory Power to Remove Voided Liens

Bankruptcy Rule 7070, incorporating Federal Rule 70 along with 28 U.S.C. § 1655, gives bankruptcy courts power to remove liens of record when the lenders don’t do so voluntarily.

9th Circuit, California, California Eastern District