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Category Archives: Northern District Cases

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N.D. Ga – Trustee Cannot Use Reverse Piercing of Veil To Recover Alleged Preferential Transfer

Posted in Northern District Cases
In Howell v. U.S. Foods, Inc., Ch. 7 Case No. 11-13160, Adv. Proc. No. 13-1054, 2014 Bankr. LEXIS 681 (Bankr. N.D. Ga. Feb. 5, 2014) (click here for .pdf of Order), the individual debtor owned and managed a restaurant incorporated as Bilbo’s Bar-B-Que, Inc.  However, the Trustee alleged that the Debtor operated the business as … Continue Reading

District Court in N.D. Ga. Finds No Willful Stay Violation Where Creditor Failed To Dismiss Collection Suit After Notice Of Debtor’s Bankruptcy Case

Posted in Northern District Cases
In Alley Cassetty Companies, Inc. v. Wren, No. 2:12-cv-196-WCO, 2013 U.S. Dist. LEXIS 11294 (N.D. Ga. July 22, 2013), the creditor, who had no notice of the Debtor’s Bankruptcy case, filed a collection suit against the Debtor in state court.  After receiving notice of the pending Bankruptcy case, creditor’s counsel informed Debtor’s counsel they would … Continue Reading

Secured Lender’s Post-Discharge Communications To Debtor Did Not Violate Discharge Injunction

Posted in Northern District Cases
In Mele v. Bank of America, et al., Adv. Proc. No. 12-5031, 486 B.R. 546, 2013 Bankr. LEXIS 455 (Bankr. N.D. Ga. January 8, 2013)(J. Ellis-Monro) (click here for .pdf copy of opinion), the issue before the Court was whether certain communications sent by the home lender after the Debtor’s Chapter 7 was discharged violate … Continue Reading

Bankruptcy Court Has Jurisdiction To Enter Final Judgment On Fraudulent Transfer Claims; Judge Sacca Follows Narrow View Of Stern v. Marshall

Posted in Northern District Cases, US Supreme Court Cases
In a 28 page opinion, Judge Sacca of the Northern District of Georgia held that Bankruptcy Courts have jurisdiction to enter final orders in some cases involving fraudulent transfer claims. Mitchell v. Banks, Adv. Proc. No. 12-0562, 2013 Bankr. LEXIS 2384 (Bankr. N.D. Ga. June 5, 2013) (click here for opinion).  Judge Sacca based his … Continue Reading

Several Popular Local Restaurants, Including Garrison’s, Einstein’s and Joe’s on Juniper, File Chapter 11 Petitions After Large Judgment Entered

Posted in News and Comments, Northern District Cases
Several popular restaurants in metro Atlanta filed Chapter 11 petitions in the Northern District of Georgia on June 13, 2013 after a $2.14 million judgment was entered in Cobb County Superior Court.  The entities filing include: Vinings Dining, LLC (d/b/a Garrison’s Boiler & Tap), Ch. 11 Case No. 13-63089 (click here for Ch. 11 petition). … Continue Reading

Single Premium Annuity Exempt In Bankruptcy, Says Georgia Supreme Court.

Posted in Eleventh Circuit Cases, Georgia State Cases, Northern District Cases
The Georgia Supreme Court recently answered certified questions from the Eleventh Circuit Court of Appeals regarding whether a single premium annuity was exempt in a Chapter 7 case, where the annuity was purchased a year before filing with $220,000 in inherited funds.  A debtor’s transfer of $220,000 a year before filing Chapter 7 is certainly … Continue Reading

Security Deed Lacking Signature of Additional Witness and Improperly Identifying Property Was Invalid in Georgia, says Eleventh Circuit

Posted in Eleventh Circuit Cases, Northern District Cases
In National City Mortgage v. Gordon (In re Bennett), No. 12-13239, 2013 U.S. App. LEXIS 10765 (11th Cir. May 29, 2013) (click here for .pdf), the issue was the validity of a Security Deed that did not contain the signature of “one additional witness,” as required by O.C.G.A. § 44-14-33 and identified a larger tract of … Continue Reading

Bankruptcy Rule Establishing Deadline To File Dischargeability Complaint Is Strict, “Hard And Fast” Rule.

Posted in Northern District Cases
In United Community Bank v. Harper (In re Harper), Adv. Proc. No. 12-1080, 2013 Bankr. LEXIS 1080 (Bankr. N.D. Ga. January 29, 2013 (Judge Drake) (click here for .pdf of order), the issue was whether Federal Rule of Bankruptcy Procedure 4007(c)  created a strict deadline for filing adversary complaints to determine dischargeability of debts under §523(c). Judge Drake … Continue Reading

Secured Lender Only Entitled To Secured Claim For Actual Fees, Not Contractual Fees, After Foreclosure

Posted in Northern District Cases
In a key decision in the Northern District of Georgia, Judge Hagenau has ruled that a secured creditor is only entitled to a secured claim, pursuant to § 506(b), to the extent of its actual and reasonable fees rather than contractual and statutory fees after a foreclosure sale where the property has not been abandoned.  … Continue Reading

ND Ga – Exception To Automatic Stay For Pre-Petition Writ Of Possession Only Applies In Landlord-Tenant Relationship

Posted in Northern District Cases
In In Re Higgs, Ch. 13 Case No. 12-76496-pwb, 2012 Bankr. LEXIS 6008 (Bankr. N.D. Ga. November 2, 2012), the Movant purchased a foreclosed property from the lender after a foreclosure sale.  Movant proceeded to obtain a writ of possession in the Magistrate Court to evict the Debtor, who was not the original borrower but … Continue Reading

ND Ga – Chapter 13 Debtor May Take “Marital Adjustment” For Non-Filing Spouse’s Income

Posted in Northern District Cases
Chapter 13 cases, especially after 2005, are often a tightrope between being able to pay basic living expenses and contributing all disposable income to the plan.  Chapter 13 Trustees are often viewed as wanting to squeeze every penny from a debtor.  This case is an example of the posturing of the parties, and a victory … Continue Reading

In Case of First Impression in Eleventh Circuit, Bankruptcy Court Holds That Overpayment of Domestic Support Obligation Is Entitled to Priority Status

Posted in Northern District Cases
In a case of first impression in the Northern District of Georgia, and perhaps the Eleventh Circuit, the Court held that a claim for the overpayment of a domestic support obligation was entitled to priority status under 11 USC § 507(a)(1)(A).  In In re Knott, Ch. 7 Case No. 09-90822, 2012 Bankr. LEXIS 5063 (Bankr. … Continue Reading

The Importance of Proper Planning: Partnership & Trust Assets of Deceased Spouse Become Property of Bankruptcy Estate

Posted in Northern District Cases
A recent opinion involves the convergence of a family partnership, will and probate estate, trust and Bankruptcy estate and highlights the need for appropriate planning and quality legal advice for each step in order to avoid a negative result years down the road. In Trauner, Ch. 7 Trustee v. Thadikamalla, et al, Adv. Proceeding No. … Continue Reading

Bankruptcy Trustee Of Swoozie’s Sues Founder & CEO For Breach Of Fiduciary Duty & Corporate Waste

Posted in News and Comments, Northern District Cases
Previous articles have discussed the fiduciary duties of officers and directors of companies in financial trouble (see articles here and here). In another adversary proceeding to hold owners, officers and directors responsible for the financial demise of their companies, the Chapter 7 Trustee of Swoozie’s has filed a Complaint against the founder and former CEO … Continue Reading

Chapter 7 Bankruptcy Trustee Files Second Lawsuit Related To Raving Brands Principals And Affiliates

Posted in News and Comments, Northern District Cases
A second lawsuit has been filed in the Chapter 7 cases related to Raving Brands and its owners, officers and affiliated companies.  The first adversary proceeding was filed last week in the Chapter 7 case In re Raving Brands, Inc., Ch. 7 Case No. 09-68410. The latest proceeding was filed in the related case, In … Continue Reading

Historic Morris Brown College In Atlanta Files Chapter 11 Bankruptcy Petition To Avoid Foreclosure

Posted in News and Comments, Northern District Cases
Morris Brown College, a historically black college in Atlanta and part of the Atlanta University Center (which also includes Clark Atlanta University, Spelman College, Morehouse College and the Morehouse School of Medicine) filed a Chapter 11 petition in the Northern District of Georgia on August 25, 2012 to avoid a foreclosure of its property.  The … Continue Reading

Bankruptcy Trustee Of Raving Brands, Inc. (Moe’s, Doc Greens, Flying Biscuit, Monkey Joe’s) Files Suit Against Former Owners, Officers And Related Entities, Alleges Fraud, Deception and Breach Of Fiduciary Duties

Posted in Corporate & Fiduciary Litigation, News and Comments, Northern District Cases
The Chapter 7 Trustee of Raving Brands, Inc.  filed on August 16, 2012 an adversary proceeding against several former owners, officers and directors of the Debtor, as well as several affiliated companies, alleging, inter alia, that the parties engaged in a widespread effort to deceive the public, its franchisees, the press, courts and its creditors. … Continue Reading

ND Ga – Judge Drake Holds Bank Had Prepetition Right To Setoff Even In Absence of Formal Demand Or Default

Posted in Northern District Cases
In re MCB Financial Group, Inc., Case No. 10-11176-WHD, 2011 Bankr. LEXIS 5502 (Bankr. N.D. Ga. March 31, 2011) (click here for .pdf of order) In 2008, Debtor MCB Financial (a bank holding company) refinanced a loan with Independent Banker’s Bank of Florida (“IBB”), and signed a demand note in the amount of $2,750,000. As … Continue Reading