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$5.9 Million in Payments to Golf Channel Declared Out of Bounds

The Fifth Circuit Court of Appeals recently issued a decision that should make defendants in Ponzi cases shiver in their boots.  The court said that the defendant, the Golf Channel, had to return nearly $6 million and that it could not take advantage of a commonly-invoked “reasonably equivalent value&rdquo...
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“Wellness” Has Made Us Better

On Thursday I published a blog article entitled Will “Wellness Make Us Better?, in which I posed the question of whether or not the U.S. Supreme Court would finally rule on whether or not bankruptcy courts can, in  Stern  type cases, enter a final judgment with the consent of the...
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Will “Wellness” Make Us Better?

The United States Supreme Court will hand down its decision in the next few weeks in the case of  Wellness Int’l Network, Ltd. v. Sharif (“Wellness”) , 727 F.3d 751 (7th Cir. 2013) regarding bankruptcy courts’ jurisdiction.  The jurisdictional quagmire is a major and growing virus in the bankruptcy...
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As Retail Bankruptcies Rise, Landlords Must Prepare

Commercial landlords should take notice. Within the last several months, one women’s clothing retailer after another has gone out of business. On Dec. 4, 2014, Philadelphia-based  Deb Shops  filed Chapter 11. Next came  Delia’s , based in New York, which filed bankruptcy only four days later. On Jan. 9...
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Retail Chapter 11 Filings Up, Bucking Bankruptcy Trends In Economic Recovery

The economy is humming along and bankruptcy filings are at historic lows. Nevertheless, a recent trend in retail may suggest that the times, they are a-changing. Radio Shack, the 95-year-old national chain that for many years was the “go-to” store for consumer electronics, has been in the headlines as a...
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9th Circ. Panel Bolsters Trustees’ Reach-Back Powers

Editor’s note: this post originally appeared in Law360 . In a recent decision, the United States Bankruptcy Appellate Panel of the Ninth Circuit resolved what it described as an issue of “first impression” in the Ninth Circuit — whether or not the two-year statute of limitations provided by Section 546(a...
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Local Bar Association Files Amicus Brief in Baker Botts v. ASARCO Case

Baker Botts L.L.P. et al. v. ASARCO L.L.C. , currently pending before the Supreme Court of the United States, is of particular interest to bankruptcy practitioners because this decision will have far-reaching effects regarding attorney’s fees in bankruptcy.  Specifically, the Supreme Court will determine whether Section 330(a) of the...
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Law Firm “Clawback” Suit Goes to Ninth Circuit

Bankruptcy Judge Dennis Montali in San Francisco said last week that he will allow a direct appeal to the Ninth Circuit from one of his rulings in the bankruptcy of Howrey LLP, skipping an intermediate appeal to the U.S. District Court.  The judge relied on  Jewel v. Boxer  — a...
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When Things Do Not Go As Planned In A Bankruptcy Sale

Editor’s note: this post originally appeared in Law360 . Buying distressed assets is big business.  Many distressed assets are acquired through the seller’s Chapter 11 bankruptcy case.   In those instances, a buyer will enter into a purchase and sale agreement with the seller/debtor and the agreement is generally subject to notice...
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Escaping Taxes in Bankruptcy Through S Corporations

Editor’s note: this blog post was recently published in Law360. Shareholders of financially troubled S corporations may now be able to avoid the flow-through of taxes when the S corporation or its subsidiary files bankruptcy.  In  In re Majestic Star Casino, LLC , 716 F.3d 736 (3rd Cir. 2013), the Third...
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Mind the Statutory Gap (aka A Jurisdictional Mess)

As we all know, on June 9 of this year, the Supreme Court issued its long-awaited decision in  Executive Benefits Ins. Agency vs. Arkison , 134 S. Ct. 2165, 189 L. Ed. 2d 83 (2014), which we had hoped would resolve the open questions arising from  Stern v. Marshall...
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Security Interests in Intellectual Property and Related Issues in Bankruptcy

Intellectual property (“IP”) can act as collateral to be pledged to secure an extension of credit.  For example, a company that borrows money from a bank can pledge its patents as collateral for the loan.  The bank (referred to as the “secured creditor”) in this case will of course...
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Report from the BHBA’s Review of the Three Bankruptcy-Related Supreme Court Decisions

The Beverly Hills Bar Association’s Bankruptcy Section recently held a program discussing the three recent bankruptcy-related Supreme Court decisions:  Law v. Siege l ,  Executive Benefits Insurance Agency v. Arkison (In re Bellingham)  (redux of  Stern v. Marshall ), and  Clark v. Rameker  (regarding inherited IRAs and exemptions).  The program was...
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When One Solution Is Better Than Two

Over the years, clients have sought my advice after they have obtained a judgment against a limited liability company or a corporation and after they have tried, without success, to collect on that judgment.  All of the typical judgment enforcement methods have already failed.  Because judgment debtors generally do...
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Why Aren’t There More Chapter 9 Bankruptcies?

After the housing market collapse, many cities and towns fell on hard times and have yet to recover.  In quite a few communities, housing prices remain low, municipal debt levels are unsustainable, and attempts to raise revenue have been rejected by voters—who are often cash-strapped themselves.  Bankruptcy offers breathing...
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Traps for the Unwary – Transfers of Personal Property Without Delivery

Imagine . . . You’ve just completed a purchase of a friendly competitor’s overstocked inventory from the current season.  She gave you a good price and will let you leave the goods at her warehouse for 30 days, just in time to pick them up for your end of season...
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Intellectual Property Licenses in Bankruptcy

What is IP in the Bankruptcy World? In bankruptcy, intellectual property (IP) licenses are considered property of the bankruptcy estate, and a bankrupt party can do a variety of things with these licenses.  It is important for holders of IP licenses to know what the possibilities are.  But first...
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A New Year Brings New Challenges

A new year always brings new and unexpected challenges.  Turnaround professionals make careers out of expecting the unexpected and helping their clients turn challenges into opportunities. We asked several turnaround professionals to let us know, in a few words, what they see coming in 2014, and here are their...
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What’s Up for Restructuring Professionals in 2014?

Filings are Down Commercial bankruptcy filings were down by 28% in 2013 over the prior period in 2012, and overall bankruptcy filings dropped 15%, putting the country on the lowest level of petitions since 2007 according to figures released by the American Bankruptcy Institute.  The data, compiled by Epiq Systems...
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The Girls Gone Wild Chronicles — Episode 1

Joe Francis built his Girls Gone Wild (GGW) empire (and the ego of an emperor) filming intoxicated college girls in various states of undress, putting that footage on VHS (and later DVDs and branded websites), and selling them to eager consumers across the globe.  If you were alive and...
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To Stalk Or Not To Stalk? — That is the Question in a 363 Sale

The biggest trend in Chapter 11 bankruptcies over the past 10 years is to sell assets through a “Section 363 sale,” named for Section 363 of the Bankruptcy Code, which describes the standards for sales in bankruptcy court.   Previously, in most Chapter 11 cases, the debtor would propose a...
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