All posts in Chapter 11

cdcbaa Program Saturday September 29, 2018 Individual Chapter 11s

Saturday, September 29, 2018

11:00 a.m. to 1:00 p.m.

 Individual Chapter 11 Cases

SPEAKERS:

  • Hon. Neil W. Bason – Central District of California
  • Steven Fox – Law Offices of Steven B. Fox
  • Stella Havkin – Havkin & Shrago
  • Peter M. Lively – Law Office of Peter M. Lively
  • Dennis McGoldrick – Law Office of Dennis McGoldrick

 Topics include Pre-Bankruptcy Planning; “First Day” Motions; Between First Day Motions and Plan Issues; Confirmation and Beyond.

Butner Principle From a Different Perspective – Simon Says May I?

I was reading this law review article on the Butner case and it provided a different view on the case that I wanted to share.  In essence,  Professor Adler questions why Butner  became so famous and a “guiding principle” when the underlying arguments and holdings are so obvious.   Butner says that since the Bankruptcy Code does not establish or define property rights, the parties must turn to nonapplicable law (state law) to answer it.  Well of course! Where else would you turn to!? That makes so much sense, why did we need nine Justices to clarify that?

This is akin to me telling you “in order to fix my plumbing problem, don’t look in the ‘House Operations Manual’ but instead look at the plumbing manual that will tell you how to fix my plumbing problem.“  We need a Supreme Court to tell us that?  The answer is so blatantly obvious let alone to become a “guiding principle!” Read more…

Client Purchased Rolex Before BK? How Courts View “Fraudulent Intent” For Credit Card Fraud

I was reading some case law on fraudulent purchases prior to bankruptcy.  At first I thought it was only “luxury” purchases (i.e. you purchase a Rolex on eve of bankruptcy) but it turns out that “luxury purchase” is just one of many factors.  If you go to McDonald’s everyday and rack up a debt there, that can be nondischargeable.

I read Dougherty and HashemiConsider these factors when advising your client: Read more…

Employment Law & BK — “Will Filing BK Affect My Chances of Getting Hired?”

Section 525 deals with protection of debtors against discrimination.  Section 525 is broken up into two main sections relating to two main standards:  one for governmental employers and one for private employers.   Let’s take a look…and note the big omission by Congress for private employers.

525(a) says a governmental unit may not:

  • Deny employment to
  • Terminate the employment of…
  • Discriminate re: employment against a person on basis of their bankruptcy filing.

525(b) says a private employer may not:

  • Terminate the employment of…
  • Discriminate re: employment against a person on basis of their bankruptcy filing.

Government cannot deny your employment because you filed bk but a private employer can!  This is also how rental companies can ask you “did you file bk in past” and deny your rental application.

 

Difference Between “False Pretense” and “False Representation” under 523(a)(2)

Section 523(a)(2)(A) excepts from discharge any debt for money obtained by false pretense, a false representation or actual fraud.   But how can you tell the difference?

False representation is an express representation.  “There are no leaks in the roof of my house.” 

False pretense is an implied representation or conduct intended to create a false impression.  “Whenever it rains, it is dry as a bone in this house, which is why I like it, I also got their decorated the right way with even an aquarium and glow in the dark fish ornaments I found online.”

 

Equipment / Inventory / Accounts Receivable

I had to refer to Article 9 to make sure I understood the difference.   We all know about cash collateral.  The most common business assets that are used for procuring a loan is inventory / equipment / accounts receivable.  Let’s break down the difference in order to understand what the secured creditor has a lien against.

Read more…

Dower and Curtesy? Sounds like a restaurant on Melrose

I had no idea what a dower and curtsy are.  Where did I find these words?  In Section 363 sale/use/lease of property.   Section 363(g) says the trustee may sell property free and clear of any right in nature of a dower or curtesy.    ::::go to google.com::::

A dower or curtesy is a surviving spouse’s right to receive a set portion of the deceased spouse’s estate (1/2 in California).  Dower (not dowry) refers to the portion to which a surviving wife is entitled, while curtesy refers to what a man may claim.  However, because discrimination on the basis of sex is now illegal in most cases, most states have abolished dower and curtesy and generally provide the same benefits regardless of sex — and this amount is often known simply as the statutory share.

Learn something new everyday.

Notifying the State Court of the Automatic Stay

More stuff I didn’t know.  A person on the California Bankruptcy Specialists listserve complained that the Superior Court in Orange wanted him to pay a first appearance fee in order to file a Notice of Automatic Stay.  A tip of the hat to Frank X. Ruggier for his response, ”If you haven’t appeared, it is the other parties responsibility to file Notice of Stay.”

ATTORNEY’S RESPONSIBILITIES FOR GIVING OF REQUIRED NOTICE TO COURT
Rule 3.650(a) of the California Rules of Court requires the party who requested or caused a stay of the proceedings to notify the court of its existence, unless that party has not appeared or is not subject to the jurisdiction of the court, in which case the plaintiff in the pending action must immediately notify the court of the stay.  Therefore, if you or your assignee commenced a civil action to recover attorney’s fees and/or costs from the client, and the clients has not appeared in the action, it is the responsibility of you or your assignee to notify the court of the automatic stay.  Judicial Council Form CM-180 has been adopted for mandatory use in giving notice of a stay of proceedings, and a copy is attached for your use.

Penthouse Global Media Files Chapter 11

U.S. Bankruptcy Court Central District of California (San Fernando Valley) Bankruptcy Petition #: 1:18-bk-10098-MB

Assigned to: Martin R. Barash Chapter 11
Date filed:   01/11/2018

 

Debtor Penthouse Global Media, Inc. 8944 Mason Ave. Chatsworth, CA 91311 LOS ANGELES-CA Tax ID / EIN: 47-2601335 represented by Michael H Weiss Weiss & Spees 1925 Century Park E Ste 650 Los Angeles, CA 90064 424-245-3100 Fax : 424-245-3101 Email: mw@weissandspees.com

Supreme Court Rejects Petition in Sunnyslope

This morning buried in the 45 page listing of Supreme Court Orders is the Order denying cert in the 9th Circuit en banc Sunnyslope case.  The Order List is here.  I thought they might take it.  It is not terribly complicated and the case discusses trying to reconcile the Supreme Court decision in Associates Commercial Corp. v. Rash with the facts in Sunnyslope.  My posting on Sunnyslope is here.   Prof. Dan Schechter says the 9th Circuit was “shockingly wrong.”