September 08, 2021

Discharge Cuts Off Future Liability on a Guaranty, Some Courts Hold on a Split

The ‘conduct’ test in the Seventh Circuit, not the ‘accrual test,’ determines when a claim arose and whether it was discharged.

7th Circuit, Wisconsin, Wisconsin Eastern District

September 07, 2021

Chapter 11 Plans May Discharge Post-Confirmation ‘Admin’ Claims, Third Circuit Says

Although Section 1141(d)(1) sets a default rule only discharging claims that arose before confirmation, Circuit Judge Ambro says that a plan may alter the default rule and allow discharge of administrative claims arising after confirmation.

3rd Circuit

September 02, 2021

Bankruptcy Courts Aren’t Prohibited from Entering Mareva Injunctions

The Supreme Court’s Grupo Mexicano decision doesn’t bar a bankruptcy court from freezing a defendant’s assets prior to judgment in a fraud action, Judge Sontchi says.

3rd Circuit, Delaware

August 31, 2021

Gerrymandering to Create an Accepting Class Didn’t Pass Muster in Orlando, Fla.

Paying more to the sole creditor in the only accepting class unfairly discriminated against other unsecured creditors, Judge Jennemann said.

11th Circuit, Florida, Florida Middle District

August 26, 2021

Subchapter V Trustee Removed for an Undisclosed Conflict of Interest

Although disqualified and removed for an undisclosed conflict, the trustee was not removed in all other cases.

11th Circuit, Florida, Florida Middle District

August 25, 2021

Selling Assets of a Defunct Business Is a Legitimate Activity in ‘Sub V,’ Florida Judge Says

The oversight of a distribution by a chapter 7 trustee (and the attendant expense) isn’t required when a debtor liquidates the assets in Subchapter V of chapter 11.

11th Circuit, Florida, Florida Middle District

August 19, 2021

First Circuit Dismisses as Moot Even Though the Appeal Dealt with Payment of Money

Dismissal of a chapter 13 case moots an appeal regarding an allegedly erroneous order directing payment of money.

1st Circuit

August 18, 2021

Debtors Can’t Easily Glom Uncashed Distribution Checks

Just because a creditor doesn’t cash a distribution check doesn’t mean it’s abandoned and reverts to the debtor.

9th Circuit, California, California Eastern District

August 12, 2021

District Judge Rakoff Explains Why the Debtor Alone May Assert a Cure Claim

A creditor can’t assert a cure claim, even though Section 365(b) doesn’t give the counterparty the sole right to demand a cure on assumption of an executory contract.

2nd Circuit, New York, New York Southern District

August 11, 2021

NC Appellate Court Rules Plans Must Be Unambiguous to Hold a Creditor in Civil Contempt, Citing Taggart

After Taggart v. Lorenzen, plans, orders and injunctions must be highly specific to hold an offending creditor in contempt.

4th Circuit, North Carolina, North Carolina Eastern District