Delaware District Court Upholds Discharge of Environmental Fines in Chapter 11
Environmental fines are discharged in chapter 11 because they do not result from pecuniary loss.
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Supreme Court Explains Sovereign Immunity in Bankruptcy Cases
The Supreme Court uses a copyright case to explain why the bankruptcy exception to states’ sovereign immunity is unique under the Constitution.
Fifth Circuit Rules that the Penalty under the ACA Isn’t a Priority Tax Claim
The exaction for failure to purchase health insurance isn’t an excise tax ‘on a transaction’ under Section 507(a)(8)(E)(i).
California Lawmakers Seek to Stop Hospital Closure Amid Coronavirus Spread
State legislators in California are calling on El Segundo, Calif.-based Verity Health to reverse its decision to close Seton Medical Center in Daly City, Calif., Becker's Hospital Review reported. Verity entered chapter 11 bankruptcy in August 2018. In January, the health system closed St. Vincent Medical Center, a 366-bed hospital in Los Angeles, after a deal to sell four of its hospitals fell through. Now, Verity is reportedly planning to shut down its hospital in Daly City. San Mateo County Supervisor David Canepa told a crowd at a community meeting March 4 that Verity is expected to shut down Seton Medical Center as soon as this week. A group of legislators is requesting Verity keep the hospital open, arguing that closing the facility would make it more difficult to treat future cases of the novel coronavirus.
To Avoid U.S. Trustee Fees, Court Liberally Allows Closing a Case After Confirmation
Pending adversary proceedings don’t preclude a finding that the chapter 11 case has been ‘fully administered,’ thus allowing entry of a final decree and cutting off further fees owing to the U.S. Trustee Program.
Fifth Circuit Opinion Shows How Not to Represent a Creditor at Confirmation
Sovereign immunity won’t prevent the bankruptcy court from extinguishing a state’s easement over a debtor’s property.
State of Michigan out $2.3 Million Investment after Cherry Growers Goes Under
The state of Michigan is out nearly $2.3 million after it ran out of options to recoup a performance-based grant from a Northern Michigan company that went under, MLive.com reported. The loss became official on Feb. 25, when the Michigan Strategic Fund Board voted to write-off $2,288,363 that it will not recover, according to state officials. Cherry Growers, Inc. in Grawn, Grand Traverse County, filed for chapter 11 bankruptcy before it paid back any of a $2.5 million performance-based state grant it received in 2012, the state said. Circumstances that led to the bankruptcy include failed apple and cherry crops in 2012 coupled with a large capital investment that same year; the $2.5 million MSF grant was part of the capital investment funding, according to an MSF document explaining the write-off. Cherry Growers filed for bankruptcy in 2017, the document said. MSF, part of the Michigan Economic Development Corporation, eventually collected $211,637.20 on its $2.5 million claim in the bankruptcy proceedings.
Supreme Court Uses a Bankruptcy Case to Limit the Use of Federal Common Law
High court rules that federal courts may make federal common law only to protect ‘uniquely’ federal interests.
U.S. Firm Hughes Fears Indian Closure, Bank Disruptions over Unpaid Fees
U.S. satellite broadband provider Hughes Network Systems may have to shut its Indian operations due to unpaid levies owed to the government, which could put thousands of banking services at risk, Reuters reported. India’s Supreme Court late last year ordered a number of telecom companies, including Hughes and larger firms like Vodafone, to pay billions of dollars owed to the government. Hughes’ India unit provides services to defence, education and banking sectors in the country and told India’s telecoms minister in a letter dated Feb. 20 that it faces bankruptcy as it can’t pay the 6 billion rupees ($84 million) it owes. The closure of the company could disrupt connectivity at more than 70,000 banking locations and many critical satellite networks in the Indian navy, army and railways, Hughes’ India President Partho Banerjee said in the letter.