On October 2, 2020, the U.S. Small Business Association issued a Procedural Notice providing “information concerning the required procedures for changes of ownership of an entity that has received Paycheck Protection Program (PPP)...
Resolving a split amongst the Circuit Court of Appeals, the United States Supreme Court recently held that retaining possession of a debtor’s property after a bankruptcy filing does not violate the automatic stay of 11 U.S.C. 362. The...
The U.S. Eastern District of Michigan recently held that an automotive OEM’s purchase order did not, as a matter of law, govern the parties’ supply contract. In Synergen Inc. v. FCA US LLC, case no. 16-cv-11842 (E.D. Mich....
In a case of first impression, the Michigan Court of Appeals recently held that Michigan law applies to the interpretation of a contract’s forum-selection clause, regardless of whether the contract contains a choice of law clause for a...
Bankruptcy is a powerful tool that businesses use to restructure their finances and remain in business. If you are struggling financially as a business owner, consider the option to file for Chapter 11 bankruptcy.
In a Chapter 11 bankruptcy, a...
Goodrich Quality Theaters has filed for bankruptcy in the U.S. Bankruptcy Court for the Western District of Michigan on February 24, 2020. The company has 30 locations across Michigan, Illinois, Indiana, Florida, and Missouri. Renovations were made...
In addition to the loss of life, the coronavirus is significantly impacting the supply chain in the automotive industry. The increasing spread of the virus in and outside of China has not only shut down plants in China, but will likely lead to...
Chapter 11 bankruptcy is a successful tool for large corporations and individuals. However, Chapter 11 bankruptcy presents many hurdles for small businesses and sometimes proves too costly. The Small Business Reorganization Act of 2019 is...
The Supreme Court’s recent decision in Mission Product Holdings v. Tempnology clarifies what happens to contractual rights upon a debtor’s rejection of a contract under Section 365 of the Bankruptcy Code. The question before the...
The Delaware Supreme Court recently held that a limited liability company’s operating agreement may void a contract entered into between the company and a related party. In CompoSecure, LLC v. CardUX, LLC, 2018 Del. LEXIS 496 (Del. Nov. 7,...
The Sixth Circuit Court of Appeals recently addressed the issue of finality in bankruptcy appeal cases. In Ritzen Group, Inc. v. Jackson Masonry, LLC, case nos. 18-5157/5161 (6th Cir. 2018), the court established a two-prong test that should be...
A debtor’s ability to discharge student loan debt gained traction in an October 4, 2018 opinion by Bankruptcy Judge Mary Ann Whipple of Toledo, Ohio. In In re Pierson, 17-3096 (Bankr. N.D. Ohio Oct. 4, 2018), the Bankruptcy Court found that...
The United States Bankruptcy Court for the Southern District of Florida dismissed an adversary proceeding filed by a secured lender seeking the return of a $200,000 retainer provided by a borrower to its bankruptcy counsel prior to filing for...
The Sixth Circuit Court of Appeals recently held that a judgment set aside for settlement purposes can have preclusive effect in subsequent litigation. In Watermark Senior Living Retirement Communities, Inc. v. Morrison Management Specialists,...
A bankruptcy court recently disallowed a secured creditor’s claim for a prepayment penalty due to the creditor exercising its acceleration rights before the debtor filed for bankruptcy. In In re Tara Retail Group, LLC, No. 17-bk-57, 2018...
The U.S. Bankruptcy Court for the District of Delaware recently issued an opinion of particular importance to those in the claims trading market: In re Woodbridge Grp. of Cos., LLC, No. 17-12560 (KJC), 2018 Bankr. LEXIS 1904 (Bankr. D. Del. June 20,...
On May 29, 2018, the Sixth Circuit Court of Appeals ruled that penalties and fines incurred in connection with fraudulently obtained unemployment benefits are non-dischargeable in Chapter 13 cases. In Andrews v. Michigan Unemployment Insurance...
In a 9-0 decision, the U.S. Supreme Court settled a circuit court split over whether a false statement about a single asset qualifies as a “statement respecting the debtor’s financial condition” under 11 U.S.C. § 523(a)(2)(B)....
In Capital One Taxi Medallion Fin. v Corrigan, 147 A.D.3d 677, 2017 N.Y. App. Div. LEXIS 1470, the court was asked to decide whether guarantors could use issues raised by the borrower in a separate action as a defense to the lender’s summary...
In Callidus Capital Corp. v. FCA Grp., Case No. 14-10484, 2018 U.S. Dist. LEXIS 54193 (E.D. Mich. filed Mar. 30, 2018), the United States District Court for the Eastern District of Michigan recently prohibited FCA Group f/k/a Chrysler Group, LLC...
A bankruptcy appellate panel of the Sixth Circuit recently affirmed a bankruptcy court’s award of significant sanctions against an individual for asserting claims that were property of the bankruptcy estate. In Low v. Ransier (In re...
The Ninth Circuit Bankruptcy Appellate Panel joined the Sixth Circuit Court of Appeals in holding that a post-bankruptcy transfer occurs on the date of honor for purposes of Section 549 of the Bankruptcy Code and not the date of delivery. See...
A unanimous U.S. Supreme Court recently narrowed the “safe harbor” protections provided to transferees in claw back litigation typically brought by bankruptcy trustees, liquidating trustees, and creditors’ committees. The...
On February 6, 2018, Governor Snyder signed Public Act 16 of 2018, the Uniform Commercial Real Estate Receivership Act. This Act provides guidance for receiverships in Michigan. Michigan was one of many states without a standard set of receivership...
In a recent opinion in In re Formosa, 2018 Bankr. LEXIS 124 (Eastern District of Michigan, Case No. 17-46215), Chief Judge Shefferly recommended a standard of practice beyond what the law requires of debtors giving notice of their bankruptcies...
On January 12, 2018, the United States Department of Transportation (USDOT) provided an update on the three Connected Vehicle Pilot Programs underway in Wyoming, New York City, and Tampa Bay. The update summarizes the progress of each connected...
The United States Bankruptcy Court for the Northern District of Illinois recently allowed an administrative expense for a creditor’s claim against an assignee for the benefit of creditors. In In re Stainless Sales Corp., No. 17-bk-03148,...
The United States Bankruptcy Court for the Northern District of Illinois recently allowed an administrative expense for a creditor’s claim against an assignee for the benefit of creditors.
Section 2-702 of the Uniform Commercial Code allows a seller of goods to reclaim goods sold to a buyer when the seller discovers that the buyer is insolvent. But what happens when that insolvent buyer files for bankruptcy? In hhgregg, Inc....
Q: What is NAFTA? A: The United States, Canada, and Mexico entered into the North American Free Trade Agreement effective January 1, 1994. NAFTA eliminated duties and trade restrictions on goods shipped between the three countries. Before NAFTA,...
Many people assume that they do not qualify for bankruptcy relief because they make too much money. They also fear that they will “lose everything” they have worked so hard for all of their lives: art, heirloom jewelry, a whole life...
A Chapter 7 Trustee’s sale of avoidance actions under sections 544, 547, and 548 of the Bankruptcy Code withstood a challenge by the targets, who claimed that the actions could not be prosecuted by parties other than the trustee, because the...
The Ninth Circuit recently affirmed a District Court ruling that applied the “dominion test” instead of the “control test” to determine initial transferees of fraudulent transfers.
In the case, Henry v. Official Comm. of Unsecured...
A Miami, Florida District Court Judge recently ruled that a Chapter 13 debtor who is near retirement age may defer over $114,000 in voluntary retirement contributions during the life of his Chapter 13 plan, while paying general unsecured creditors a...
An Illinois Appellate Court recently held that a senior lender that violated the terms of an intercreditor agreement partially relinquished its priority in collateral securing its loan. In Bowling Green Sports Center, Inc. v. G.A.G. LLC, 2017 IL App...
The Sixth Circuit Court of Appeals recently affirmed a trial court’s decision to strike an affirmative defense alleging antitrust violations in a breach of contract case. In Hemlock Semiconductor Operators, LLC v. SolarWorld Industries Sachsen...
In Giasson Aero. Sci., Inc. v. RCO Eng'g Inc., 2017 U.S. App. LEXIS 18165 (6th Cir. Sep. 20, 2017), the Sixth Circuit Court of Appeals held that a party seeking an independent action for relief from a final judgment under Rule 60(d)(1) must...
The Ninth Circuit Court of Appeals recently split with the Seventh by holding that sovereign immunity does not prevent a bankruptcy trustee from avoiding a debtor’s federal tax payments to the Internal Revenue Service. In Zazzali v. United States...
In Gecker v. Estate of Flynn (In re Emerald Casino, Inc.), 2017 U.S. App. Lexis 14895 (7th Cir., August 11, 2017), the Chapter 7 trustee sued former casino officers, directors, and shareholders for, among other things, breaches of fiduciary duties...
A recent ruling by the Ninth Circuit Court of Appeals that a lessee’s possessory right did not survive a “free and clear” sale under section 363 of the Bankruptcy Code is a warning to tenants of a bankrupt landlord to be diligent.
The case,...
The United States Bankruptcy Court for the District of Delaware recently denied a secured lender’s motion for partial judgment on the pleadings that the lender’s interest in certain goods took priority over a vendor’s interest in those same...
The Michigan Court of Appeals recently affirmed a trial court's decision to bar trial witnesses because a party failed to timely disclose them. In Roeder v. Global Express Services, LLC, 2017 Mich. App. LEXIS 947 (June 13, 2017), the trial court had...
The Chapter 11 debtor in In re Arm Ventures, LLC, 564 B.R. 77 (Bankr. S.D. Fla. 2017) owned a commercial building. The debtor repeatedly maneuvered in state and federal court to stop foreclosure sales by the bank. Ultimately, the debtor filed...
The Sixth Circuit Court of Appeals recently held in a 2-1 decision that an “insured-versus-insured” exclusion found in a directors’ and officers’ liability insurance policy applied to a breach of fiduciary duty claim brought by a liquidating...
In Frank v. Linkner, decided on May 15, 2017, the Michigan Supreme Court made several important rulings involving limited liability company member oppression claims. First, the Court held that member oppression claims accrue under MCL 450.4515 when...
The United States Supreme Court recently held that the filing of a time-barred proof of claim "is not a false, deceptive, misleading, unfair, or unconscionable debt collection practice within the meaning of the Fair Debt Collection Practices Act." ...
The Michigan Supreme Court recently held that a plaintiff waived her right to a jury regarding the award of attorney fees. In Barton-Spencer v. Farm Bureau Life Ins. Co. of Michigan (Mich. April 14, 2017), the plaintiff had signed an agreement...
Resolving conflicting holdings in the Eastern District of Michigan, the Sixth Circuit recently held that an assignment of rents is a transfer of ownership under Michigan law and the assignor retains no residual property rights in the assigned rents....
In Planet Bingo, LLC et al. v. VKGS, LLC, the Michigan Court of Appeals recently held that not all common-law unfair competition claims are preempted by the Michigan Uniform Trade Secrets Act (“MUTSA”). While holding that MUTSA preempts claims...
The United States Supreme Court recently held that “[a] distribution scheme ordered in connection with the dismissal of a Chapter 11 case cannot, without the consent of the affected parties, deviate from the basic priority rules that apply under...
The Michigan Court of Appeals recently reiterated that the burden of proof shifts to a fraudulent transfer defendant to establish that a transaction was “in all respects bona fide” when a plaintiff establishes the elements of a fraudulent...
The Bankruptcy Court for the District of Delaware recently upheld the terms of a pre-petition intercreditor agreement by ruling that the first lien rights of an asset based lending group were not impacted by the pre-petition restructuring of the...
In Meoli v. Huntington Nat'l Bank, the Sixth Circuit affirmed a multi-million judgment against The Huntington National Bank stemming from a bankruptcy trustee’s lawsuit seeking to recover fraudulent transfers from a debtor company’s operation of...
The Michigan Court of Appeals recently continued its trend of enforcing settlements despite the absence of a signed settlement agreement. In Trevino v. Siler, et al., case no. 330120 (Mich. Ct. App. January 17, 2017), the plaintiff's counsel called...
In In re Tuscan Energy LLC, 16-100398 (Bankr. S.D.Fla. Dec. 30, 2016), a bank objected to a fee application of Debtor’s counsel on the grounds that the pre-petition retainer paid to counsel constituted the bank’s cash collateral that should not...
A Delaware Bankruptcy Court recently held that an unsecured creditors’ committee’s legal fees were not subject to a pre-confirmation cap contained in a financing order. In In re Molycorp, Inc., Case No. 15-11357 (Bankr. D. Del. Jan. 5, 2017),...
In the personal bankruptcy of a husband and wife, a bankruptcy trustee sought to avoid an allegedly fraudulent transfer between two third-party corporations. Debtors entered into a purchase agreement to purchase a farm, then assigned the purchase...
The Supreme Court of Texas recently held that the transfer of $5.9 million from Stanford International Bank Ltd. to the Golf Channel for media-advertising services was not recoverable as a fraudulent transfer, even though Stanford used the services...
The Michigan legislature, at the recommendation of the Uniform Law Commission, is considering replacing the Uniform Fraudulent Transfer Act with the Uniform Voidable Transactions Act. The proposed legislation would, according to the Senate Fiscal...
In Blixseth v. Brown, et al. (In re Yellowstone Mount Club, LLC), No. 14-35363 (9th Cir. November 28, 2016), the Ninth Circuit Court of Appeals held that the Barton doctrine applies to members of an Unsecured Creditors’ Committee and, therefore, a...
In Jones v. CitiMortgage, Inc., et al., Case No. 15-14853, the plaintiff filed suit in federal district court to stop the foreclosure sale of his home. One of his allegations was that the foreclosure violated a the bankruptcy discharge injunction...
In Ochadleus v. City of Detroit (In re City of Detroit), Nos. 15-2194, 2337, 2353, 2371, 2379 (6th Cir. Oct. 3, 2016), the Sixth Circuit Court of Appeals affirmed an order prohibiting Detroit pensioners from challenging cuts to their pensions under...
The Michigan Court of Appeals recently upheld a trial court’s ruling that the sale of real estate by a receiver free and clear of all liens, claims, and encumbrances, including mortgages in favor of a subcontractor, was a proper exercise of the...
The Sixth Circuit Court of Appeals recently held that a party can be bound to a mutual release of claims in a settlement agreement despite failing to sign it. In Baker Hughes, Inc. v. S&S Chemical LLC, et al., case no. 15-2413 (6th Cir. September...
In Bash v. Textron Financial Corporation (In re Fair Finance Company), the Sixth Circuit Court of Appeals reversed a district court’s dismissal of a chapter 7 trustee’s civil conspiracy claim. The chapter 7 trustee had sued Textron Financial...
The United States Bankruptcy Court for the District of Delaware recently permitted a creditor to set off its allowed post-petition administrative expense claim against its preferential liability. In Official Committee of Unsecured Creditors of...
A Bankruptcy Court recently voided an operating agreement provision requiring the consent of a secured lender-placed "special member" for a Michigan LLC to file a bankruptcy petition.
In In re Lake Michigan Beach Pottawattamie Resort LLC, 547 B.R....
The Superior Court of Rhode Island recently granted a motion for replevin in favor of an unperfected secured creditor, Pet Food Experts, Inc., and against another unperfected secured creditor, Greenwood Credit Union, to partially satisfy obligations...
The Michigan Court of Appeals recently held that a party to a mortgage can take advantage of equitable subrogation. In Albace v. RAAW Enterprises, et al., case no. 326435 (Mich. Ct. App. June 21, 2016), the defendants owed the plaintiff $300,000...
General Products Corporation, a full service supplier of engineered, complex, and precision machine components and assemblies for the automotive and heavy-duty truck markets, filed Chapter 11 bankruptcy on June 27, 2016 in the United States...
In Intervention Energy Holdings, LLC, Case No. 16-11247, the United States Bankruptcy Court for the District of Delaware recently held that a provision inserted into a limited liability company’s operating agreement to restrict the filing of a...
In In re Sabine Oil & Gas Corp., 548 B.R. 674 (Bankr. S.D.N.Y. 2016), a New York bankruptcy court recently refused to apply the divestiture doctrine to stay confirmation proceedings pending an appeal. The court had previously denied a request by...
On May 16, 2016, the United States Supreme Court held in Husky International Electronics, Inc. v. Ritz, 578 U.S. ___ (2016), that the term "actual fraud" in a bankruptcy non-discharge section encompasses fraudulent conveyance schemes, even when...
The Court of Appeals of Texas held that the written words in loan documents prevail over contradictory numerals. In Charles R. Tips Family Trust v. PB Commercial LLC, 459 S.W.3d 147 (Tex. App. 2015), Patriot Bank loaned $1,700,000 to Charles R....
The Michigan Court of Appeals recently held that the circuit court did not have jurisdiction over a claim and delivery action because the complaint included allegations of a failure to follow procedures for abandoned vehicle reporting. In Ford Motor...
In Southwest Sec., FSB v. Segner (In re Domistyle, Inc.), 811 F.3d 691, (5th Cir. 2015), the trustee attempted to sell property believed by all parties to be worth more than the secured debt. Once he was unable to sell the property for an amount...
The United States Court of Appeals for the Seventh Circuit recently held that a debtor’s termination of two commercial leases constituted transfers subject to avoidance and recovery. In Official Committee of Unsecured Creditors of Great Lakes...
In J&N Koets, Inc. d/b/a Advanced Restorations, v. Onemarket Properties Lake Point LLC, et al., case no. 324007 (Mich. Ct. App. January 12, 2016), the owners of a condominium complex asked the plaintiff restoration company to address water damage...
The United States Court of Appeals for the Third Circuit recently ruled that payments made by a secured creditor to unsecured creditors and their professionals were not property of the estate and, thus, not subject to the Bankruptcy Code’s...
The Seventh Circuit Court of Appeals recently voided Bank of New York Mellon’s ("BNYM") security for its $312 million dollar loan to Sentinel Management Group because the bank was aware of suspicious facts that should have led it to investigate...
Great Lakes Comnet, Inc., an owner and operator of a 6,500 mile fiber network serving Michigan and neighboring states, and Comlink, L.L.C., a provider of dedicated ultra-high-speed bandwidth data transmission, filed for bankruptcy on January 25,...
A Bankruptcy Court in the Middle District of Pennsylvania recently held that proceeds of a D&O policy owned by a Chapter 7 debtor were not property of the estate. In Brothers v. Neblett (In re Valley Forge Composite Techs., Inc.), 2015 Bankr. LEXIS...
The Bankruptcy Appellate Panel (BAP) of the Sixth Circuit recently held that a Bankruptcy Court did not err by granting a motion for relief from stay to continue litigation against a Chapter 7 individual debtor. In In re Martin (6th Cir. BAP Dec....
The City of Detroit filed lawsuits today in the United States Bankruptcy Court seeking to recover millions that the City paid to its creditors before it filed for protection under Chapter 9 of Bankruptcy Code. Each lawsuit seeks to recover payments...
The United States Bankruptcy Court of Appeals for the Seventh Circuit ruled that a lender could defeat an avoidance action because its agreement to forbear exercising its rights provided sufficient value. In 1756 W. Lake St. LLC v. Am. Chartered...
The Michigan Court of Appeals recently held that a contract purporting to grant a party exclusive rights to transport motor fuel was unenforceable. In Armada Oil Company LLC d/b/a AOG Trucking v. Barrick Enterprises, Inc., (No. 321636, September...
In Mediofactoring, et al. v. McDermott, creditors applied for administrative claims seeking payment of attorneys' fees and costs on the basis that they had substantially contributed to a Chapter 7 bankruptcy case. The creditors argued that their...
Postpetition financing is usually crucial to a debtor’s chapter 11 success. Once an order is entered authorizing postpetition financing, however, creditors and other interested parties are generally powerless to reverse the order’s effects. In...
The United States Bankruptcy Court for the District of Delaware recently held that the Trademark License Agreement between Trump AC Casino Marks, LLC (“Trump AC”) and Trump Entertainment Resorts, Inc. and certain of its affiliates (“Trump...
The Michigan Court of Appeals recently addressed the bankruptcy estate of Borman’s, the company connected with the now defunct Farmer Jack grocery store chain. In Ashley Livonia A&P v. The Great Atlantic & Pacific Tea Co., et al. (Case No....
In Ellmann v. Baker (In re Baker), 2015 U.S. App. LEXIS 11437 (6th Cir. 2015), the Sixth Circuit Court of Appeals held that Law v. Siegel, 134 S. Ct. 1188 (2014), limits a bankruptcy court’s power to disallow claimed exemptions. The debtors had...
In Baker Botts v. Asarco, 576 U.S. __ (2015), the United States Supreme Court held that Section 330(a)(1) of the Bankruptcy Code does not permit a bankruptcy court to award attorney’s fees for work performed in defending a fee application in...
In Bank of America, N.A. v. Caulkett, 575 U.S. __ (2015), the United States Supreme Court overruled the longstanding ability of a debtor to void a junior mortgage under 11 U.S.C. § 506(d) when the debt owed on a senior mortgage exceeds the value of...
The United States Bankruptcy Court for the Western District of New York recently held that a collateral description in a UCC financing statement was not "seriously misleading," even though it was "needlessly convoluted." In Ring...
A bankruptcy court recently held that a business’s Facebook and Twitter accounts were property of the estate. In In re CTLI, LLC, Case No. 14-33564 (S.D. Texas April 3, 2015), a former owner of a Chapter 11 corporate debtor refused to relinquish...
In an unpublished opinion, the Sixth Circuit Court of Appeals held in Waldman v. Stone that a district court is not required to receive additional evidence when reviewing a bankruptcy court’s proposed findings of fact and conclusions of law....
The court in In re Headlee Mgmt. Corp., 519 B.R. 452 (Bankr. S.D.N.Y. 2014) refused to order disgorgement of interim fees paid to Chapter 11 professionals where the debtor’s estate was insolvent on conversion to Chapter 7. The Chapter 11...
The Seventh Circuit Court of Appeals held that the First Amendment and the Religious Freedom Restoration Act (RFRA) do not protect religious organizations from avoidance actions brought by unsecured creditors’ committees. Listecki v. Official...
The Michigan Court of Appeals recently addressed the obligations of guarantors in connection with a bankruptcy discharge. In Talmer West Bank v. Stewart, Nos. 316678; 317420 (Mich. Ct. App. December 11, 2014), the bankruptcy court had confirmed a...
The United States Bankruptcy Court for the Western District of Tennessee held that the mere fact a secured creditor’s right to credit bid had a potential chilling effect on third-party bids was not, without more, sufficient cause to justify...
In Official Committee of Unsecured Creditors of Motors Liquidation Co. v. JP Morgan Chase Bank, N.A. (In re Motors Liquidation Co.), No. 13-2187 (2d Cir. Jan. 21, 2015), the Second Circuit Court of Appeals held that a clerical error rendered a...
In In re Derma Pen, LLC, the United States Bankruptcy Court for the District of Delaware dismissed a chapter 11 bankruptcy that lacked a good faith attempt to reorganize or preserve value for creditors and was determined to have been filed as a...
In Dillard v. Schlussel, No. 315485, 2014 Mich. App. LEXIS 1985, at *1 (Mich. Ct. App. Oct. 21, 2014), the Michigan Court of Appeals held that "a debtor’s transfer of assets for the purpose of paying the debtor’s ordinary household expenses [did...
In Anderson v. Fisher (In re Anderson), No. 14-08007, 2014 Bankr. LEXIS 3908 (B.A.P. 6th Cir. Sept. 15, 2014), the Sixth Circuit Bankruptcy Appellate Panel upheld a Tennessee bankruptcy court’s decision entitling a state court "penalty" default...
The United States Bankruptcy Court for the Eastern District of Virginia held that a secured creditor’s right to credit bid was capped because of, among other things, its aggressive tactics. The case involved the purchase of a $50 million secured...
In Madugula v. Taub, 2014 Mich. LEXIS 1281 (Mich. July 15, 2014), the Michigan Supreme Court held that parties do not have a right to a jury trial in actions for shareholder oppression; rather, such claims must be heard by a court sitting in equity....
The Fourth Circuit Court of Appeals, in National Heritage Foundation v. Highbourne Foundation, 2014 U.S. App. LEXIS 12144 (4th Cir. June 27, 2014), recently held a Chapter 11 plan’s non-consensual, third party release of non-debtors invalid...
The Michigan Court of Appeals recently held that courts may create a "gap filler" that reaches a result contrary to a contract's terms. In Martlew v. City of Benton Harbor, et al. (Case No. 311897, May 1, 2014), the plaintiff entered into a contract...
In Exec. Benefits Ins. Agency v. Arkison, Chapter 7 Tr. of Estate of Bellingham Ins. Agency, Inc., 573 U.S. ___, (2014), the United States Supreme Court held that claims designated for final adjudication in the bankruptcy court as a statutory...
In an unpublished opinion, the Michigan Court of Appeals in Shaya v. Karam, et. al, Case No. 308905, refused to allow plaintiffs to enforce a promissory note because plaintiffs possessed only a photocopy of the note. Plaintiffs had taken their...
The United States Court of Appeals for the Sixth Circuit in Westfield Ins. Co. v. Talmer Bancorp, 545 Fed. Appx. 402 (6th Cir. Oct. 30, 2013) held that a secured party’s insurance coverage rights under a loss payee provision are derivative of its...
In a direct appeal from the bankruptcy court, the Sixth Circuit reversed the bankruptcy court’s confirmation of an individual’s chapter 11 plan of reorganization and held that the plan must satisfy the absolute priority rule. Ice House Am. v....
In Hart v. Southern Heritage Bank, Case No. 13-6188 (April 28, 2014), the United States Court of Appeals for the Sixth Circuit held that a Bankruptcy Court for the Eastern District of Tennessee had constitutional authority to enter a final monetary...
On March 26, 2014, the Michigan Supreme Court approved amendments to MCR 2.621 and MCR 2.622 regarding receiverships in Michigan. Court Rule 2.622 was amended to specifically set forth the process for the appointment of a receiver, selection of a...
The Michigan Court of Appeals recently issued a rare opinion refusing to enforce a contract on public policy grounds. In Ammori v. Nafso (Case No. 312498, January 28, 2014), the parties entered into an otherwise valid oral agreement to divide...
The Michigan Court of Appeals reversed a circuit court judgment on tortious interference and remanded for entry of a judgment of no cause of action. In Datam Manufacturing v Magna Powertrain USA(Case No. 306202, February 13, 2014), Magna competed...
The United States Bankruptcy Court for the Southern District of New York, in Official Committee of Unsecured Creditors of Motors Liquidation Company v. JPMorgan Chase Bank, N.A., 486 B.R. 596 (Bankr. S.D.N.Y. 2013), ruled against a creditors’...
A debtor in bankruptcy is required to submit a list of his or her creditors with the creditors’ names and addresses under Fed. R. Bankr. P. 1007(a). In Lampe v. Kash , 2013 U.S. App. Lexis 22704 (6th Cir 2013), the debtor (Kash) filed his...
The United States District Court for the District of New Jersey upheld the Bankruptcy Court’s ruling that a junior creditor’s assignment of voting rights to a senior creditor under an intercreditor agreement is enforceable in bankruptcy. In In...
The Michigan Court of Appeals, in a 2-1 panel decision, gave some clarity to a question bank lawyers have litigated in Michigan trial courts for years: whether a garnishee bank can trump the garnishing creditor of a bank’s borrower by claiming –...
Groeb Farms, Inc., a honey processor and producer of industrial sweeteners headquartered in Onsted, MI, filed a Chapter 11 bankruptcy petition on October 1, 2013. The U.S. Department of Justice accused Groeb Farms of evading anti-dumping duties on...
In Edgewater Growth Capital Partners LP v. H.I.G. Capital, Inc., 68 A.3d 197 (Del. Ch. 2013), the Delaware Court of Chancery upheld the sale of a borrower’s assets to an entity related to borrower’s secured creditor, finding that the assets were...
The Sixth Circuit Court of Appeals recently held that a district court’s denial of a Chapter 11 reorganization plan in bankruptcy proceedings is not a "final appealable order." The Court began its analysis by reaffirming the general principle that...
The United States Bankruptcy Court for the Eastern District of Wisconsin held that a pre-petition stay waiver in favor of debtor’s lender is a factor to be considered in determining "cause" for relief from the automatic stay under 11 U.S.C....
On August 13, 2013, the Bankruptcy Court entered Mediation Order [Docket No. 322] in the City of Detroit Bankruptcy Case. The Mediation Order appoints Judge Rosen, the Chief Judge of the United States District Court for the Eastern District of...
On July 18, 2013, the City of Detroit filed the largest municipal bankruptcy in the history of the United States. Since the filing, the Bankruptcy Court has entered 22 orders, including orders (a) affirming that challenges to the City’s...
The Michigan Supreme Court recently held that account stated and open account actions are subject to the six-year limitations period provided by MCL § 600.5807(8), even when the actions are based on a debt stemming from the sale of goods. In Fisher...
The first step in the bankruptcy process requires the City to prove that it is eligible for Chapter 9 protection. Eligibility requirements include the City of Detroit proving that it is insolvent and that it has negotiated in good faith with...
The Michigan Court of Appeals recently held that Michigan courts may exercise jurisdiction over businesses that have engaged in a single past transaction in the state and that subsequently ceased doing business here. In Larsen Services, Inc v. Nova...
The Sixth Circuit recently held that a trustee and his attorneys were protected by quasi-judicial immunity from claims of malicious prosecution and abuse of process. In Grant, Konvalinka & Harrison, PC v. Banks (In re McKenzie), Case No. 12-5874...
The City of Detroit’s Emergency Manager, Kevyn D. Orr, submitted his Financial and Operating Plan on May 12, 2013. The Plan provides that its objectives are to ensure that Detroit is able to provide governmental services essential to the public...
In re Managed Storage International, Inc., 2012 WL 5921723 (Bankr. Del. 2012), the Delaware Bankruptcy Court held that a release given by a debtor in connection with a sale under § 363 of the Bankruptcy Code was binding upon a subsequently...
The Sixth Circuit has recognized a cause of action under Michigan law for aiding and abetting tortious conduct. In El Camino Resources Ltd v. Huntington National Bank, Case No. 12-1254 (6th Cir. April 8, 2013), the court addressed a claim for aiding...
The United States District Court for the Eastern District of Michigan granted Wolfson Bolton’s client’s motions to dismiss two bankruptcy appeals. Following relief from the automatic stay in bankruptcy court, Debtor filed appeals to the District...
The Bankruptcy Court for the Eastern District of Michigan recently issued an opinion restricting the use of 11 U.S.C. § 502(d) to object to and delay payment of administrative expense claims. In re Energy Conversion Devices, Inc., 2013 Bankr. LEXIS...
