Young and New Members

Young and New Members December 2017

Commodity Broker Liquidations: What Qualifies as a “Commodity Contract”?

The Seventh Circuit’s recent decision in Secure Leverage put to bed nearly five years of litigation on the question of what contracts are sufficiently “similar to” futures contracts under § 761(4) of the Bankruptcy Code to receive the highest priority of repayment in a commodity broker liquidation.[1] The court held that in order for a contract to be considered a commodity contract within the meaning of § 761(4), it must bear certain fungible features.[2]

Crowdfunding in Bankruptcy: What Happens to Backers When the Project Fails? Part II: Are Class Action Proofs of Claim the Solution?

Part I of this article identified several important issues that arise when crowdfunded companies file for bankruptcy. Among the most foreseeable dilemmas is that only a handful of crowdfunding backers would file a proof of claim, allowing equity-holders to recover an unduly high share of the debtor’s assets. As previously discussed, the relatively low contribution by any one backer makes this situation especially likely.

CFPB Sues Ocwen for Technological Deficiencies in Mortgage Servicing

In April of 2017, the Consumer Financial Protection Bureau (CFPB) sued Ocwen Financial Corporation (Ocwen) and its affiliates for supposed systematic deficiencies in their mortgage servicing business.

Beyond Midland Funding v. Johnson: Calculating Limitations on Proofs of Claims – Part 2

Editor's note: Part I of this article was published in the July 2017 edition of the Young and New Members Committee newsletter, and can be found on the committee's website.

Canadian Recognition of U.S. Bankruptcy Proceedings: Not Always a Rubber Stamp for First-Day Orders

First-day orders in U.S. chapter 11 proceedings deal with a wide range of pressing issues within a limited timeframe. Moreover, foreign recognition of first-day orders in cross-border insolvencies, particularly in Canada-U.S. ones, have been dealt with in a context of a high degree of mutual deference and collaboration between jurisdictions.

The Puerto Rico “Bankruptcy”: A Cheat Sheet

On May 3, 2017, the Financial Oversight and Management Board of Puerto Rico launched an unprecedented restructuring proceeding under Title III of the Puerto Rico Oversight, Management, and Economic Stability Act (“PROMESA” or the “Act”). This article provides a very high-level summary[1] of some of the unique provisions in PROMESA, the bankruptcy analogue crafted specially by Congress for the debt crisis in Puerto Rico, and highlights some of the main players and key developments thus far.[2]

Beyond Midland Funding v. Johnson: Calculating Limitations on Proofs of Claims, Part 1

The U.S. Supreme Court recently weighed in on whether the filing of a proof of claim could give rise to a violation of the Fair Debt Collection Practices Act (FDCPA) if the statute of limitations on the underlying claim had expired.

Crowdfunding in Bankruptcy: What Happens to Backers When the Project Fails? Part I: Why Crowdfunding Is Different

For the uninitiated, “crowdfunding” is a form of fundraising in which many relatively small contributions are sourced from a “crowd” of “backers” to support a prospective goal, product or company. Crowdfunding transactions can be structured as donations, pre-orders, loans or even equity investments. With the rise of internet platforms such as Kickstarter, crowdfunding has become an easy way for early-stage companies to obtain financing, test the market and bring attention to their products.

Article Discussion: Energy Sector Restructurings

This May edition of the ABI Bankruptcy Litigation Committee Newsletter focused on bankruptcy litigation issues in energy sector restructurings. The newsletter featured an article exploring assumption and rejection of oil and gas conveyances, and an article discussing CERCLA liabilities in energy-related cases . Following publication of this newsletter, both authors hosted a call to discuss the issues explored in their articles.Click here to review the articles.

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