Rule 60 & The Intersection of Criminal and Bankruptcy Law

Posted on July 2, 2009 by Seth Leventhal

Allen Stanford, Marc Dreier, Bernie Madoff, Tom Petters… More than a few cases these days are at or near the intersection of criminal law and bankruptcy law and the U.S. Court of Appeals for the Eighth Circuit, reviewing an appeal from the Bankruptcy Appellate Panel for the Eighth Circuit has weighed in today. The basic facts of the In re: Racing Services, Inc. decision were that a company, Racing Services (“RSI”) and its pre… Continue reading →

Hecker Bankruptcy News

Posted on September 14, 2009 by Seth Leventhal

In one of the larger bankruptcy cases pending in the District of Minnesota, today was the deadline for any claims for the nondischargeability of debt under 11 U.S.C. Section 523, “Exceptions to Discharge,” by which creditors can save their debts from being wiped out in the bankruptcy process by establishing that the debt at issue falls within one of the statutory exceptions. (A number of these exceptions boil down to debts that were… Continue reading →

“Alice in Wonderland” in BK Court? Debtor Not Allowed To Waive Discharge…

Posted on February 10, 2010 by Seth Leventhal

Bankruptcy is a means by which people and businesses can get a “fresh start” when they cannot otherwise escape their debts. What they generally seek is “discharge” of their debts. Not all debts are dischargeable, however. Moreover, under certain circumstances, a debtor may choose to waive his right to discharge of debt if, for example, there is a dispute in the bankruptcy court as to whether a debt is dischargeable and… Continue reading →

Home Valu Involuntary Bankruptcy: Fairly Rare Event, but Perhaps on the Rise?

Posted on February 2, 2010 by Seth Leventhal

The Star Tribune reports today that Home Valu, founded by former Minnesota U.S. Senator Rudy Boschwitz, has been put into involuntary bankruptcy. Such proceedings are relatively rare, as pointed out in the article by bankruptcy veteran George Singer of Linquist and Vennum. The creditors bringing the proceeding are represented by Dave Runck, of Fafinski, Mark & Johnson, P.A. … Continue reading →

Receiver, Trustee, Investors, Victims, Hundreds of Millions of Dollars…Challenge to Petters Receiver/Trustee Rebuffed

Posted on September 9, 2009 by Seth Leventhal

Whether it is analysis of what constitutes a “final order” for purposes of appeal or an analysis of conflicts of interest, given the very different nature of bankruptcy proceedings from generic civil litigation, courts often adopt a more flexible and pragmatic approach in bankruptcy cases. Such is the case in the Petters Bankruptcy where U.S. District Court Judge Montgomery has upheld a ruling by Bankruptcy Judge Gregory F. Kishel … Continue reading →

Failure to Record Mortgage, an Error Compounded by Three Failed Challenges

Posted on January 13, 2010 by Seth Leventhal

Wells Fargo made a mortgage loan, then failed to record the mortgage for whatever (undisclosed) reason, so that, when borrower/homeowner filed for bankruptcy, Wells Fargo was a mere unsecured lender due to its failure to perfect its security interest by recording it. Wells Fargo had been designated as a secured creditor throughout the bankruptcy due to an error of the debtor. When Wells Fargo’s unsecured status came to light (about … Continue reading →

8th Cir. BAP: No Constructive Trust For Mere "Mistake"

Posted on June 8, 2009 by Seth Leventhal

…und construction. Unfortunately for Langlie, it appears that his banker inadvertently transferred $123,000 from Langlie’s account to Farr’s account for a $23,000 draw — just before Farr went into Chapter 7 bankruptcy. Thereafter, once the error was identified, Farr gave Langlie the money back. The bankruptcy trustee sought to “claw back” the money into Farr the debtor’s estate as a preferential or fraudulen… Continue reading →

No Homestead Exemption For Hecker: "It Would Not Be Unfair or Unjust Not To Pierce the Corporate Veil"

Posted on October 7, 2009 by Seth Leventhal

(How many negatives are in that sentence?) In disallowing Dennis “Denny” Hecker’s homestead exemption claim today, Bankruptcy Judge Robert Kressel has rejected Dennis E. Hecker’s “insider reverse veil piercing theory,” one of many perhaps convoluted legal theories that has evolved from the invention of the corporation. In a nutshell, Hecker claimed the homestead exemption under bankruptcy laws (designed … Continue reading →

Where’s the Note? Show Us The Note.

Posted on October 19, 2011 by Seth Leventhal

… market mortgage transactions, this fairly straightforward requirement is not necessarily simple in every case. Thus, Edward and Diane Banks can freely admit to having defaulted on a $415,000 loan (having themselves filed for bankruptcy), and it is recognized that investor Kondaur Capital was assigned the now-bankrupt lender’s interest in the loan, but until Kondaur can come up with the note itself, its claimed interest against the ironical… Continue reading →

Edina Law Firm to U.S. Supreme Court: BAPCA & The First Amendment: Update

Posted on October 20, 2009 by Seth Leventhal

… Gallop v. U.S., 08-1119, and U.S. v. Milavetz, Gallop, 08-1225, consolidated cases before the U.S. Supreme Court, appealed from the U.S. Court of Appeals for the Eight Circuit. The law firm challenges certain aspects of the Bankruptcy Abuse Prevention & Consumer Protection Act (“BAPCA”) of 2005. At issue: the constitutionality of a 2005 federal bankruptcy reform law that barred attorneys from advising debtors to take on more deb… Continue reading →

U.S. Supreme Court Decides Milavetz BAPCPA Case

Posted on March 8, 2010 by Seth Leventhal

Justice Sotomayor, writing for the Court, joined in full by six Justices and in part by Justices Scalia and Thomas, the U.S. Supreme Court holds that attorneys who provide bankruptcy assistance are debt-relief agencies under the bankruptcy abuse law (opinion is here) and that the BAPCPA (Bankruptcy Abuse Prevention and Consumer Protection Act) does not violate the consitution in setting limitations on advice that “debt relief agencies̶… Continue reading →

The Simple Claim of a Harmful Side Effect/The Complexity of Federal Preemption of State Law Claims

Posted on November 9, 2010 by Seth Leventhal

The interesting fact pattern that gives rise to the problem in this case is what are the duties of a generic drug manufacturer if, after a drug’s initial federal approval (and approval (and then mandated use) of a specific warning label), new information comes to light about potentially harmful side effects? Can a claim be brought against the manufacturer under state law for failure to warn? Gloria Mensing took a medicine, MCP, a gene… Continue reading →

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