LexisNexis® Legal Newsroom
    Dewey & LeBoeuf Creditors Say $15M Claim Should Be Allowed Even Though It's Late

    NEW YORK - Creditors of bankrupt law firm Dewey & LeBoeuf on July 16 filed a brief arguing that the bankruptcy court should permit them to file a late claim for $15 million as a result of alleged malpractice by one of the firm's attorneys (In Re: Dewey & LeBoeuf, No. 12-12321, Chapter 11, S.D. N.Y. Bkcy.).

    Exide Committee: DIP Loan Is 'Extremely Prejudicial' To Unsecured Creditors

    WILMINGTON, Del. - The Official Committee of Unsecured Creditors in the Chapter 11 bankruptcy of Exide Technologies on July 16 filed a brief objecting to the company's request for bankruptcy court approval of $500 million in post-petition financing, also known as debtor-in-possession (DIP) financing, on grounds that the case control milestones encompassed in the loan are "extremely prejudicial" (In Re: Exide Technologies, No. 13-11482, Chapter 11, D. Del. Bkcy.).

    5th Circuit Reverses Ruling; Debtor Has Valid Claim For Promissory Estoppel

    NEW ORLEANS - A panel of the Fifth Circuit U.S. Court of Appeals on July 15 partially reversed and partially affirmed a district court decision, ruling that a debtor who was foreclosed upon by her lender had stated a plausible claim for promissory estoppel even though she did not state a claim for declaratory relief on the basis of waiver (Gloria Martin-Janson v. JPMorgan Chase Bank, No. 12-50380, Chapter 13, 5th Cir.; 2013 U.S. App. LEXIS 14284).

    2nd Circuit Reverses; Evidence Needed On Automatic Stay Issue In ResCap Bankruptcy

    NEW YORK - A panel of the Second Circuit U.S. Court of Appeals on July 15 reversed a District Court ruling and held that more evidence was needed to determine whether the automatic stay applied in a case where the Federal Housing Finance Agency (FHFA) sued the parent and affiliates of Bankrupt Residential Capital (ResCap) related to home loans (Residential Capital v. Federal Housing Finance Agency $(In Re: Residential Capital LLC$), No. 12-3342, Chapter 11, 2nd Cir.).

    8th Circuit: Debtors May Not Claim Exemption For Claim Related To Personal Injury

    ST. LOUIS - A panel of the Eighth Circuit U.S. Court of Appeals on July 12 affirmed a bankruptcy court's decision and said that based on precedent, a debtor couple could not claim an exemption for an unliquidated personal injury claim (Abdullah Abdul Rahim, et al. v. John V. LaBarge Jr. $(In Re: Abdullah Abdul Rahim, et al.$), No. 12-3448, Chapter 13, 8th Cir.; 2013 U.S. App. LEXIS 14103).

    U.S. Trustee: OnCure's More Than $425,000 Retainer Does Not Meet Criteria

    WILMINGTON, Del. - The U.S. trustee in the Chapter 11 bankruptcy case of OnCure Holdings Inc. on July 12 filed a brief in the U.S. Bankruptcy Court for the District of Delaware objecting to the more than $425,000 retainer the company proposes to pay its bankruptcy counsel, on grounds that it does not meet the criteria for what is called an evergreen retainer (In Re: OnCure Holdings Inc., No. 13-11540, Chapter 11, D. Del. Bkcy.).

    ResCap Seeks OK To Make $230M Payment To End Federal Reserve Foreclosure Review

    NEW YORK - Bankrupt Residential Capital LLC (ResCap) on July 12 moved for authorization to enter into a consent agreement with the Federal Reserve Board (FRB) and the Federal Deposit Insurance Corp. under which it would pay $230 million to satisfy its payments under the FRB foreclosure review and end the review process (In Re: Residential Capital LLC, No. 12-12020, Chapter 11, S.D. N.Y. Bkcy.).

    National Envelope Proposes Plan For $67.5 Million In DIP Financing

    WILMINGTON, Del. - Bankrupt NE Opco Inc., formerly National Envelope Inc., on July 12 moved in the U.S. Bankruptcy Court for the District of Delaware for approval of an agreement with creditors and lenders that would pave the way for $67.5 million in post-petition financing, also called debtor-in-possession (DIP) financing (In Re: NE Opco Inc., No. 13-11483, Chapter 11, D. Del. Bkcy.).

    4th Circuit: Fraud Ruling, Sanctions Proper For Debtor's Discovery Abuses

    RICHMOND, Va. - A panel of the Fourth Circuit U.S. Court of Appeals on July 10 ruled that a debtor's repeated violations of discovery orders warranted a decision by a bankruptcy court that denied him the right to present evidence at trial, resulting in his conviction for fraud (Southern Management Corporation Retirement Trust v. Robert Fulton Rood IV, No. 12-2359, Chapter 7, 4th Cir.; 2013 U.S. App. LEXIS 13946).

    Bankrupt Video Game Maker THQ Says Liquidation Plan Complies With Bankruptcy Code

    WILMINGTON, Del. - Bankrupt video game maker THQ Inc. filed a brief on July 11 arguing that the U.S. Bankruptcy Court for the District of Delaware should approve its plan of liquidation on grounds that it complies with all the provisions of the Bankruptcy Code (In Re: THQ Inc., No. 12-13398, Chapter 11, D. Del. Bkcy.).

    San Bernardino Creditors: City Is Eligible For Chapter 9 Bankruptcy

    RIVERSIDE, Calif. - A group of creditors in the Chapter 9 bankruptcy of the City of San Bernardino, Calif., filed a brief joining the city's brief arguing that the bankruptcy court should grant summary judgment and rule that it is eligible to be a debtor (In Re: City of San Bernardino, Calif., No. 12-28006, Chapter 9, C.D. Calif. Bkcy.).

    Rothstein Trustee: Objections To Liquidation Plan Should Be Dismissed

    FORT LAUDERDALE, Fla. - The Chapter 11 trustee in the bankruptcy of former law firm Rothstein Rosenfeldt Adler (RRA) on July 10 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York contending that the U.S. trustee's objections to confirmation of the plan of liquidation should be dismissed (In Re: Rothstein Rosenfeldt Adler, No. 09-34791, Chapter 11, S.D. N.Y. Bkcy.).

    11th Circuit: Debtor's Damages Not Caused By Attorney Wrongdoing

    ATLANTA - A panel of the 11th Circuit U.S. Court of Appeals on July 10 affirmed a ruling that a debtor's damages could not be blamed on wrongdoing by his attorneys (Sohail M. Abdulla v. Scott J. Klosinski, No. 12-15448, Chapter 7, 11th Cir.; 2013 U.S. App. LEXIS 13960).

    Creditor With More Than $250M In Claims Objects To Kodak's Plan To Offer Only $1

    NEW YORK - Creditor STWB Inc. on July 10 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York, arguing that bankrupt Eastman Kodak Co. should not be permitted to estimate the amount of certain claims in its Chapter 11 case because doing so would "effectively disenfranchise" STWB of valuable property rights, which are part of its general unsecured claims exceeding $250 million (In Re: Eastman Kodak Company, No. 12-10202, Chapter 11, S.D. N.Y. Bkcy.).

    Bankrupt MSR Says Five Mile Capital Lacks Standing To Convert Case To Chapter 7

    NEW YORK - Bankrupt MSR Hotels & Resorts Inc. on July 10 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York arguing that Five Mile Capital Partners LLC, which seeks to convert the Chapter 11 bankruptcy to Chapter 7, lacks standing (In Re: MSR Hotels & Resorts Inc., No. 13-11512, Chapter 11, S.D. N.Y. Bkcy.).

    NMP Group LLC Files Chapter 11 Bankruptcy To Avoid Loss Of Property At Auction

    NEW YORK - Real estate company NMP Group LLC on July 10 filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the Southern District of New York to avoid having its property sold at auction following foreclosure proceedings (In Re: NMP Group LLC, No 13-12269, Chapter 11, S.D. N.Y. Bkcy.).

    Bankrupt Hardware Company Objects To Damages Claim Of More Than $17.55M

    WILMINGTON, Del. - Bankrupt Handy Hardware Wholesale Inc. on July 8 filed a brief in the U.S. Bankruptcy Court for the District of Delaware objecting to an additional claim filed by Trans Power Corp. for more than $17.55 million in damages (In Re: Handy Hardware Wholesale Inc., No. 13-10060, Chapter 11, D. Del. Bkcy.).

    Bankrupt Versace Mansion Seeks Court's OK To Sell Property

    FORT LAUDERDALE, Fla. - Casa Casuarina LLC, the former mansion of designer Gianni Versace that is the subject of a dispute in the Chapter 11 bankruptcy of the former law firm Rothstein Rosenfeldt Adler (RRA), on July 10 moved in bankruptcy court for permission to sell the property as part of its own Chapter 11 proceeding (In Re: Casa Casuarina LLC, No. 13-25645, Chapter 11, S.D. Fla. Bkcy.).

    Stockton, Calif., Taxpayers Want Official Committee Status In Bankruptcy Case

    SACRAMENTO, Calif. - A group representing the interests of taxpayers in the Chapter 9 bankruptcy of Stockton, Calif., on July 8 filed a brief arguing that the U.S. trustee should appoint an official taxpayers committee to give it a voice on the city's proposal to increase taxes as part of its plan to exit bankruptcy (In Re: Stockton, Calif., No.12-32118, Chapter 9, E.D. Calif. Bkcy.).

    Hostess Seeks To File Property Value Information Under Seal As It Sells Assets

    NEW YORK - Bankrupt Old HB Inc., formerly known as Hostess Brands Inc., on July 3 moved in bankruptcy court for permission to file under seal proprietary information pertaining to the valuation of real property the company seeks to sell as it unloads various assets (In Re: Old HB Inc. f/k/a Hostess Brands Inc., No. 12-22052, Chapter 11, S.D. N.Y. Bkcy.).

    Investors In KV Pharmaceutical Bankruptcy Say Their Debt Should Be Given Priority

    NEW YORK - A group of investors known as the Ad Hoc Senior Noteholders Group on July 3 filed an adversary complaint in the Chapter 11 bankruptcy of pharmaceutical company KV Discovery Solutions, seeking a declaration that the convertible notes are subordinated under the Convertible Notes Indenture to interest that has accrued on the Senior Notes (Silver Point Finance LLC, et al. v. Deutsche Bank Trust Company Americas $(In Re: KV Discovery Solutions Inc.$), No. 12-13346, Chapter 11, S.D. N.Y. Bkcy.).

    7th Circuit: Debtor Must Pay Tax Liens; Bankruptcy Code Wording 'Straightforward'

    CHICAGO - A panel of the Seventh Circuit U.S. Court of Appeals on July 8 affirmed a bankruptcy court ruling and determined that a debtor was liable for all the tax liens filed against him by the IRS, and it held that the language of the Bankruptcy Code was "straightforward" on the matter (Patrick J. Ryan v. United States of America $(In Re: Patrick J. Ryan$), No. 12-3398, Chapter 13, 7th Cir.; U.S. App. LEXIS 13710).

    Bankruptcy Judge Remands Insolvent Insurer's Receiver's Fraudulent Transfer Claim

    LINCOLN, Neb. - A federal bankruptcy judge in Nebraska on July 3 remanded a lawsuit filed by an insolvent insurer's receiver against the estate of a former insurance agency regarding conversion of unremitted premiums and fraudulent transfers of assets (In the matter of: Diederike Marlene Fulkerson; State of Florida, ex rel. Florida Department of Insurance, receiver for United Southern Assurance Co. v. Diederike Marlene Fulkerson, No. BK12-41750-TLS & A12-4081-TLS, Chapter 7, D. Neb. Bkcy.; 2013 Bankr. LEXIS 2697).

    9th Circuit Partially Remands Debtor's Loan Case, Says Federal Law Violated

    SAN FRANCISCO - A panel of the Ninth Circuit U.S. Court of Appeals on July 3 partially affirmed, partially reversed and remanded a district court ruling, determining that a debtor couple demonstrated that its lender had violated federal lending laws when it failed to honor the loan modification agreement the parties had agreed to during their bankruptcy (John Schlegel v. Wells Fargo Bank NA $(in re: John Schlegel$), No. 11-16816, Chapter 11, 9th Cir.; 2013 U.S. App. LEXIS 13595).

    Dewey & LeBoeuf Liquidating Trustee Objects To Claim Of More Than $6.62 Million

    NEW YORK - The liquidating trustee in the Chapter 11 bankruptcy of former law firm Dewey & LeBoeuf on July 5 filed a brief objecting to a claim valued at $6,626,777 filed by Gallagher Fiduciary Advisors LLC (GFA) on grounds that the claim was already waived by the firm's former partners (In Re: Dewey & LeBoeuf, No. 12-12321. Chapter 11, S.D. N.Y. Bkcy.).