Archive for June, 2012

City of Stockton Files Chapter 9 Bankruptcy Petition

By | June 29, 2012 | Community, Current Events | 4 Comments

U.S. Bankruptcy Court
Eastern District of California (Sacramento)
Bankruptcy Petition #: 12-32118

Assigned to:
Chapter 9
Voluntary
Asset

Date filed:

   06/28/2012

 

 
Debtor
City of Stockton, California
City Hall
425 North El Dorado Street
Stockton, CA 95202
SAN JOAQUIN-CA
Tax ID / EIN: 94-6000436

represented by

 Marc A. Levinson
400 Capitol Mall #3000
Sacramento, CA 95814-4407
(916) 447-9200
U.S. Trustee
Office of the U.S. Trustee
Robert T Matsui United States Courthouse
501 I Street, Room 7-500
Sacramento, CA 95814

 

Weil, Gotshal Top Bankruptcy Firm per Vault

By | June 28, 2012 | Firm Announcements | No comments

FOR IMMEDIATE RELEASE

VAULT.COM UNVEILS LAW PRACTICE AREA RANKINGS

WEIL, GOTSHAL NAMED NO. 1 BANKRUPTCY LAW FIRM FOR 4TH STRAIGHT YEAR

 New York, NY, (June 27, 2012) Today, Vault.com, the source of ratings, rankings and insight for law students and lawyers, released its Practice Area Rankings for 2013.  This year, as has been the case for the previous three years, Weil, Gotshal & Manges was the firm rated strongest in bankruptcy law by associates.

The firm once again beat out Kirkland & Ellis to claim its fourth straight title.  According to survey respondents, Weil is “one of the big guys” and a “powerhouse,” whose attorneys are “bankruptcy masters.”  Weil; Kirkland & Ellis; and Skadden Arps remained in the same positions as last year – No. 1, No. 2, and No. 3, respectively – but the rest of the Top 10 saw some significant movement this year.

Among the changes, Jones Day jumped one spot to No. 4, pushing Akin Gump Strauss Hauer & Feld down one spot to No. 5. White & Case also moved up one notch to No. 9, while Latham & Watkins returned to the Top 10—after a two-year hiatus—at No. 8 in a tie with Wachtell Lipton. Pachulski Stang Ziehl & Jones debuted on the list at No. 7, making it the only bankruptcy boutique voted onto the Top 10.

In order to determine the Vault Practice Area Rankings, nearly 17,000 associates were asked to vote for up to three firms they consider strongest in their own practice area, but were not permitted to vote for their own firm.  Vault’s rankings indicate the top firms in each area, as well the total percentage of votes, offering law students and associates a tool to aid in their career search.

The Top 10 Bankruptcy Law Firms Are:

Read more…

Judge Neil Bason Hearing Times to Change

By | June 28, 2012 | Chapter 13, Judges Corner | 1 Comment

Judge Bason News:

Starting with the 8/30 Calendar, the confirmation hearings will begin at 9:00 a.m.

Aki Koyama

Penalties on Non-Dischargeable Taxes are Discharged in Chapter 7 (Sometimes)

By | June 27, 2012 | Taxes | No comments

I saw on another bulletin board recently a blanket statement that penalties on non-dischargeable taxes are discharged in chapter 7.  I spent a little time trying to confirm this as it is surprising to me.   As is common, the statement is sort of true but not completely.  The conundrum is set forth in Section 523(a)(7)(A) and (B).  (a)(7) states that penalties are not discharged “except (certain tax penalties).”  In re McKay v. United States, 957 F.2d 689 (9th Cir. 1992) takes a good stab at explaining that section.  In McKay, the taxpayer was found guilty of filing fraudulent tax returns.  That may be, he said, but the penalites are nevertheless discharged.  The district court agreed.  The Court of Appeals agreed saying:

Carefully parsed, [523(a)(7)] initially makes nondischargeable a “debt that is for a fine, penalty or forfeiture payable to and for the benefit of a governmental unit.”  Withdrawn from this class, however, are any such fines, penalties, or forfeitures that are “compensation for actual pecuniary loss.”  These are dischargeable.  The double negative, “does not discharge” and “not compensation for actual pecuniary loss,” accomplishes this end.  Another group of penalties are withdrawn from the nondischargeable group.  These appear in parts (A) and (B) of § 523(a)(7).  Part (A) withdraws tax penalties attributable to taxes which are not nondischargeable.  That is, part (A) makes dischargeable tax penalties attributable to dischargeable taxes.  This follows because part (A) relates “to a tax of a kind not specified in paragraph (1) of this subsection.”  Those types specified in paragraph (1) are not dischargeable taxes.  In relevant part “paragraph (1) of this subsection” makes not dischargeable “any debt” that is “for a tax … with respect to which the debtor made a fraudulent return or willfully attempted in any manner to evade or defeat such tax.”

Judge Vincent Zurzolo Updated Website

By | June 25, 2012 | Chapter 11, Judges Corner | No comments

Judge Zurzolo updated his forms, procedures, and pleadings that he does not want sent to him, as well as various other requirements on his (the court’s) website.

Go the court’s website here, then:  Home; Information;  Zurzolo, Vincent P.; FORMS/PROCEDURES/SELF-CALENDARING.

 


Prof. Katie Porter Program at cdcbaa

By | June 23, 2012 | Programs | 1 Comment

 Prof. Katie Porter put on a great program, entitled, Ten Bankruptcy Myths, this morning at Southwestern Law School.  She started by telling us that we in the Central District are kind of weird, or strange, or odd, I forget the term she used.  “You are outliers,” she said.  The results of the statistical studies she works on often skew to the central district because we are such a large portion of the total.  The talk focused on who files bankruptcy, why, and the effects of things like BAPCPA, filing without a lawyer, race, and the stigma of filing.  For example, she easily convinced us that the stigma of filing a bankruptcy petition is as huge as ever.  Most people treat filing bankruptcy as equal to a death in the family.  And the people who file are more likely to be older than younger, etc. etc.  I highly recommend the program if you get a chance to go see her.

You may know, “In March 2012, Prof. Porter was appointed by California Attorney General Kamala Harris to be the state’s independent monitor of banks in a nationwide $25 billion mortgage settlement.”  If you have a question about that, she can be reached at CAMonitor@doj.ca.gov.

4th Circuit Rejects Broad View; First Among CCAs to Address Abrogation of Absolute Priority Rule in Individual Chapter 11 Case

By | June 22, 2012 | Absolute Priority Rule, Chapter 11 | 1 Comment

On June 14, 2012 the United States Court of Appeals for the Fourth Circuit published its opinion in In re Maharaj which succintly concludes that, “the absolute prioirty rule as it applies to individual debtors in Chapter 11 has not been abrogated by BAPCPA.” See, In re Maharaj, -F.3d-, No. 11-1747 (4th Cir. 2012). The case was before the 4th Circuit on direct appeal from an order denying confirmation entered by the bankruptcy court.

In reaching its decision, the 4th Circuit compiled all of the divergent published opinions recognizing that one district court, one bankruptcy appellate panel and five bankruptcy courts have taken the “broad view” (including the BAP’s Friedman decision) and over a dozen bankruptcy courts have adopted the “narrow view” (including Judge Kwan’s Arnold decision and Judge Albert’s Kamell decision).  On June 20, 2012 the Ninth Circuit dismissed the Friedman appeal, thus leaving intact the 9th Circuit BAP decision.

Thus, the status of the absolute priority rule in individual chapter 11 cases within the Central District remains a matter to be determined on a judge by judge basis. First, Central District Courts differ on whether BAP opinions bind the Bankruptcy Courts. Second, if not bound by the BAP’s Friedman decision, our Courts still differ on the legal issue as to whehter BAPCPA abrogated the absolute priority rule in individual chapter 11 cases.

The author is aware that Judge Smith, Judge Tighe and Judge Ahart (based on his CBJ article) subscribe to the “broad view.” Replies with experiences on the subject before other Central District courts would be helpful.

Court To Implement CM/ECF Filing Agent on July 16, 2012

By | June 22, 2012 | Court Clerk Information, Current Events | No comments

On July 16, 2012, the Court will implement CM/ECF Filing Agent. Filing Agent is an optional feature that enables registered CM/ECF users to assign unique logins and passwords to support staff filing electronic documents on their behalf. Filing Agent will also provide all registered CM/ECF users with the ability to maintain email account information via the Utilities > Maintain Your ECF Account hyperlink (pursuant to LBR 2091-1, registered users are prevented from using Filing Agent to change their address).

The Court has posted an Electronic Learning Module (ELM), containing the necessary steps to associate a Filing Agent to a registered CM/ECF user’s profile. Please note that since the ELM was created by the National Training Branch, some CM/ECF screen information depicted in the ELM may be slightly different from the information contained in the Court’s CM/ECF system (i.e., group names).

We encourage all registered CM/ECF users who are interested in using Filing Agent to review the ELM and become familiar with the process. To access the public notice announcing the implementation of this new feature and the ELM for training click this link:

http://www.cacb.uscourts.gov/cacb/Welcome.nsf/PN12-010?OpenPage

A second link appears inside the public notice to review the ELM or go to the CM/ECF webpage under Registration/Training.

Detailed instructions for maintaining your Filing Agent and email account information are attached.

Orange County Bankruptcy Forum Brown Bag Program — Individual Chapter 11 Cases: Tips and Pitfalls

By | June 21, 2012 | Programs | 1 Comment

Orange County Bankruptcy Forum — Brown Bag Program
Individual Chapter 11 Cases: Tips and Pitfalls
July 12, 2012

Speakers:
Michael Hauser, Attorney for Office of the U.S. Trustee
Rob Goe, Goe & Forsythe, LLP

This event is approved for 1.0 hour of MCLE credit.

Ronald Reagan Federal Building
411 W. 4th Street, Santa Ana
Chapter 13 Meeting Room ~ Room 1154

Registration begins at 11:30 a.m.
THE PROGRAM WILL COMMENCE AT 12:00 SHARP!
*Despite the name “Brown Bag,” no food or beverages are allowed in the meeting room.

Members and Government Employees $10 / Non-Members $25

Register here. 

Response to Prof. Scarberry re Reaffirmations

By | June 20, 2012 | Reaffirmations | 6 Comments

Hi Jon,

I read Mark’s summary.  I think that although we reach opposite conclusions, we don’t disagree on the analysis of the issue.

However, there is a long line of cases which I cited in my article that support the position that provided the debtor states an intention to reaffirm, cooperates with creditor in executing reaffirmation K, and attends reaffirmation agreement  then ride-though exists if the judge denies the agreement.

11 U.S.C. §§362(h)(1)(a), 521(a)(2)(A), 521(a)(2)(B),521(a)(6)(B), 521(d).  In re Perez, 2010 Bankr. LEXIS 2229, at *29 (Bankr. D. N.M. July 12, 2010) (The court held that §521(a)(2)(B) does not require the debtor toconsummate an enforceable reaffirmation agreement,since whether the agreement is enforceable depends on factors outside the debtor’s power or control, but only to do all that is within the power and control of the debtor.). See also In re Moustafi, 371 B.R. 434, 438 (Bankr. D. Ariz. 2007); In re Husain, 364 B.R. 211, 219 (Bankr. E.D. Va. 2007); In re Barron, 441 B.R. 131, 137 (Bankr. D. Ariz. 2010); In re Chim, 381 B.R. 191, 198 (Bankr. D. Md. 2008). In re Hardiman, 398 B.R. 161, 187 (E.D. N.C.2008) (The court held that since the debtor had alreadycomplied with §§362 and 521, the remaining language stating, “[n]othing in this title shall prevent or limit the operation of an [an ipso facto clause]” does not apply.); In re Perez, 2010 Bankr. LEXIS 2229, at 40.  The same analysis should be applied when reading the language used later in §521(d).

As for language in 521(d), the Hardiman case sets forth that this provision only applies when the debtor fails to do something required after the passage of BAPCPA which basically requires the debtor to:

1) State an intention to reaffirm 2) Cooperate with creditor in executing and sending reaffirmation agreement back to creditor (This may be something debtors and debtor’s counsel may want to document in case creditor tries to claim debtor did not do this); and 3) Attend the reaffirmation hearings.

Read more…

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