Bankruptcy

A person adversely affected by a bankruptcy court order has the standing to appeal from the order, even if he did not appear at the hearing or raise an objection before entry of the appealed order. Read More

Creditors of a bankrupt debtor could not be held in contempt of the discharge injunction and sanctioned for filing post-petition motions in a state court action for an award of attorney fees against the debtor, since they had a good faith (albeit incorrect and unreasonable) belief that the injunction did not apply. Read More

In evaluating whether a person is an “insider” of a debtor under the Bankruptcy Code, an appellate court reviews a trial court’s determination of whether a transaction was arm’s length using the clear error standard of review. Read More

In determining whether a bankruptcy trustee has the power to set aside a fraudulent transfer, the Court must examine the transaction the trustee seeks to avoid, not the intermediate transactions that effectuated the ultimate transaction. Read More

Under bankruptcy law, persons who unknowingly received funds a dishonest employee had embezzled were “initial transferees” of the funds, and strictly liable to repay them, since the funds were paid by check drawn on an account that the dishonest employee had established in the employer’s name, but without its knowledge. Read More

The automatic stay in bankruptcy does not extend the three-year deadline for serving process on a co-defendant of the bankrupt debtor, that is not itself in bankruptcy. Read More

A party cannot “remove” a case from federal district court to bankruptcy court; instead, the party must seek a discretionary transfer to the district in which the bankruptcy is pending and then a discretionary referral to the bankruptcy court.   Read More

Bankrupt debtor is considered to have transferred property with intent to defraud his creditors even though he moved the assets out of one of his wholly owned corporations rather than from his own possession.   Read More

Bankruptcy debtors’ real estate commissions for property deals they had negotiated pre-petition, but which closed post-petition, should be considered part of the bankruptcy estate.   Read More

A district court order vacating a bankruptcy court order confirming a bankruptcy plan and remanding for further proceedings is not a final order from which an appeal as of right may be taken to the Court of Appeals.   Read More

A debtor’s bankruptcy estate is entitled to the full amount of debtor’s spendthrift trust distributions due to be paid as of the petition date, except for the portion the beneficiary needs for his support or education if the trust instrument specifies the funds are to be used for that purpose.   Read More

Lender's alleged failure to (1) provide reinstatement amounts in response to a defaulted borrower's request or (2) respond to plaintiff's claimed tender of arrearages under the deed of trust, were protected activity under the Anti-SLAPP statute, but only because they occurred in the context of the borrower’s bankruptcy proceeding.   Read More

A bankruptcy trustee may sell the bankrupt estate's real property free and clear of unexpired leases, so the lessees' interest and right to possession is ended by the sale free and clear.   Read More

11 USC 727(e) sets a one-year-from-discharge time limit on a bankruptcy trustee’s request to revoke the discharge based on debtor’s fraud,  but since it is a statute of limitations, the debtor waives its protection if he fails to plead that defense in his answer.  Read More

Reporting to a credit agency on the deliquency or overdue status of a debt is not a per se violation of the automatic stay, which only forbids collection on the debt, not reports about it.  Read More

Filing a facially time-barred creditor’s claim in a Chapter 13 is not a false, deceptive, misleading, unconscionable or unfair means of collecting a debt under the FCDPA, since Chapter 13 debtors are protected from paying dubious claims by the Chapter 13 trustee's supervision of the case.  Read More

If a junior lien securing a non-recourse debt is wiped out by a senior creditor’s foreclosure sale before the debtor files a Chapter 11 bankruptcy petition, the sold-out junior lienholder is not entitled to a recourse claim against the Chapter 11 bankruptcy estate.  Read More

Private citizen claims brought under the Private Attorney General Act are not exempt from the automatic stay in bankruptcy.  Read More

Proceedings in non-bankruptcy courts to enforce sanctions against the debtor for litigation misconduct—including, as here, discovery sanctions—are exempt from the automatic stay.  Read More

Bankruptcy courts should use federal choice-of-law rules to determine which state’s law to  apply (such as, here, which statute of limitations is applicable).  Read More