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Georgia Bankruptcy Blog

Category Archives: Miscellaneous Cases

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3rd Cir. – Section 546 Statute of Limitations Expired Prior To Election of “Permanent Trustee,” Thus Barring Avoidance Actions

By: Scott B. Riddle, Esq. This opinion could by very important in Chapter 11 (or 13) cases that are nearing their two-year anniversary and in danger of conversion. In Singer, Trustee v. Franklin Boxboard Co. (In re American Pad & Paper, Co.), No. 05-1379, 2007 Bankr. LEXIS 4792 (3rd Cir. March 2, 2006), the Chapter 11 Order… Continue Reading

Texas Bankruptcy Court Finds Georgia Courts Would Not Recognize Tort of Deepening Insolvency; Denies Motion To Dismiss Based On Exculpation Provision

Posted By: Scott B. Riddle, Esq. In Kaye v. Dupree, et al. (In re Avado Brands, Inc.), Adv. No. 05-3823, 2006 Bankr. LEXIS 3631 (Bankr. N.D. Tex. December 28, 2006), the Trustee of the Debtor’s Litigation Trust filed a post-confirmation suit against the Debtor’s former officers and directors.  The causes of action included preferential transfers,… Continue Reading

Reclamation Of Goods Under The BAPCPA

Section 546 of the Bankruptcy Code was amended with the enactment of the BAPCPA.  The new provisions provide sellers of goods with a 45-day window for reclamation, instead of incorporating the 10 day window in the Uniform Commercial Code, require that the goods be sold in the ordinary course of the seller’s business, requires the… Continue Reading

Southern District Of New York Interprets Section 14-2-640 Of Georgia Business Corporation Code

By: Scott B. Riddle, Esq. Deutsche Bank A.G. London Branch v. Worldcom, Inc. (In re Worldcom, Inc.), 2006 U.S. Dist. LEXIS 92729 (S.D.N.Y. December 21, 2006). The plaintiff filed proofs of claim in Worldcom’s Bankruptcy case for pre-petition dividends that were announced, but never paid. The issue before the District Court, on appeal from the Bankruptcy… Continue Reading

Extension Of Time To Assume Or Reject Non-Residential Lease Must Be Obtained Prior to Expiration of 120 Day Period In BAPCPA Section 365(d)(4)

In In re Tubular Technologies, LLC, Chapter 11 Case No. 06-00228 (Bankr. D. S.C. June 21, 2006) (click here for the opinion), the debtor filed a Chapter 11 petition on January 20, 2006.  On May 12, 2006, 112 days after the petition date, the debtor moved, pursuant to 11 U.S.C. §365(d)(4), for an extension of… Continue Reading

Delaware Supreme Court – If Trustee Does Not Properly Seek Substitution Or Intervention In Trial Court, He Has No Standing To Appeal

Francis G.X. Pillegi, in the Delaware Litigation Blog, discusses the case of Bryan v. Doar, (Del. Supr., Nov. 6, 2006), in which the Delaware Supreme Court held that the Bankruptcy Trustee of the Creditor Trust did not have standing to appeal a Chancery Court decision when he failed to seek substitution under Rule 25(c) or intervention at… Continue Reading

1st Cir. – Trustee’s Claims Arising From Fraudulent Merger Dismissed For Affirmative Defense Of In Pari Delicto

In Nisselson v. Lernout, 2006 U.S. App. LEXIS 27562 (1st Cir. November 8, 2006), (click here for opinion) the Trustee of a Litigation Trust filed suit against several parties for securities fraud, fraud, unfair trade practices, negligent misrepresentation and conspiracy.  The claims arose from a failed merger. The basic, relevant facts are relatively straightforward. "Old… Continue Reading

Court Finds BAPCPA Provision Facially Unconstitutional

Zelotes v. Martini, 2006 U.S. Dist. LEXIS 81385 (D. Conn. November 7, 2006).  The plaintiff, a bankruptcy lawyer, filed a lawsuit to declare Section 526(a)(4) unconstitutional. This section provides — A debt relief agency shall not . . . advise an assisted person or prospective assisted person to incur more debt in contemplation of such… Continue Reading

Trustee Obtains Summary Judgment Due to Adverse Party’s Pre-Litigation Destruction Of Documents

The Electronic Discovery Blog discusses the case of In re Quintus Corp., 2006 WL 3072982 (Bankr. D. Del. Oct. 27, 2006), wherein the Delaware Bankruptcy Court entered summary judgment in favor of a Bankruptcy Trustee based upon the adverse party’s destruction of documents. See  $1.888 Million Judgment Entered in Favor of Bankruptcy Trustee Based on… Continue Reading

Third Circuit: Deepening Insolvency A Valid Cause Of Action In Pennsylvania, But Cannot Be Based Upon Allegations Of Mere Negligence

In In re CITX Corp. (Seitz v. Detweiler Hershey & Assoc., PC), 448 F.3d 672, 2006 U.S. App, LEXIS 13141 (3rd Cir. May 26, 2006), the debtor was also alleged to have been an illegal Ponzi scheme. The Chapter 7 Trustee filed suit against the accounting firm for, inter alia, deepening insolvency. The District Court… Continue Reading

On-Court Basketball Incident Leads to Nondischargeable Debt

There have been several recent stories about on-the-field or on-the-court incidents during sporting events.  See Youth Coach Attacks Opposing Player; Temple Coach John Chaney Sends "Goon" To "Send A Message," Miami v. Florida International, etc.  In Brokaw v. McSorley, Adv. No. 05-31213, 2006 Bankr. LEXIS 2728 (Bankr. S.D. Iowa October 18, 2006), the debtor was a… Continue Reading