Justia Bankruptcy Opinion Summaries

Plaintiff voluntarily filed for Chapter 7 bankruptcy seeking to discharge debts he identified as primarily business related. On appeal, plaintiff challenged the district court's order affirming the bankruptcy court's dismissal of his petition for bad faith under 11 U.S.C. 707(a). The court concluded that, based on the ordinary meaning of the statutory language and relevant principles of statutory construction, the power to dismiss "for cause" in section 707(a) included the power to involuntarily dismiss a Chapter 7 case based on prepetition bad faith. Under the totality of the circumstances, the bankruptcy court did not clearly err in finding that plaintiff filed his Chapter 7 petition in bad faith. Accordingly, the court affirmed the judgment, concluding that the bankruptcy court did not abuse its discretion in dismissing the petition. View "Piazza v. Nueterra Healthcare Physical Therapy, LLC" on Justia Law

Defendant, a lawyer, deposited lucre in his law firm's bank accounts after he was convicted of criminal activity, where it was commingled with the firm's receipts from legitimate clients. At issue was whether the money in the bank accounts at the time defendant was charged was subject to forfeiture. The sheer volume of financial information available and required to separate tainted from untainted monies in this case lead the court to apply the Third Circuit's rule in United States v. Voigt; in this case, the district court erred in ordering forfeiture of the funds as proceeds; consequently, all proceedings the court held subsequent to the imposition of defendant's sentence must be vacated; the court's conclusion did not foreclose the Government's attempt to forfeit a property interest held by defendant individually; and, after addressing the parties' remaining arguments, the court reversed and remanded the judgment of the district court. View "United States v. Rothstein" on Justia Law

The bankruptcy trustee of Northlake, a Georgia corporation, filed suit against defendant, a shareholder of Northlake, alleging that a 2006 Transfer was fraudulent. The facts raised in the complaint and its exhibits, taken as true, were sufficient to conclude that Northlake's benefits under the Shareholders Agreement were reasonably equivalent exchange for the 2006 Transfer. Because the complaint contained no allegations indicating why these benefits did not constitute a reasonably equivalent exchange for the 2006 Transfer, the court had no ground to conclude that they did not. Accordingly, the court affirmed the judgment of the district court. View "Crumpton v. Stephen" on Justia Law

This case stemmed from the fallout from the failure of the Fountainebleau development in Las Vegas, Nevada and involved the contract dispute between the Term Lenders, the Revolving Lenders, and the Borrowers. The district court dismissed the Term Lenders' claims against the Revolving Lenders, finding that the Term Lenders lacked standing to sue. The district court also denied the Borrowers' motion for summary judgment against the Revolving Lenders, rejecting the Borrowers' argument that the Revolving Lenders had breached the contract as a matter of law and alternatively finding there were material issues of fact about whether the Revolving Lenders breached the contract. The court held that the Term Lenders lacked standing to enforce section 2.1(c) of the Credit Agreement promise and affirmed the district court's dismissal of the breach of contract claims. The court could not conclude as a matter of law that the Revolving Lenders broke their promise to fund the Borrowers under section 2 of the Credit Agreement and affirmed the district court's denial of the Borrowers' request for turnover of the loan proceeds and specific performance. View "Avenue CLO Fund, Ltd., et al v. Bank of America, NA, et al" on Justia Law

Debtors filed for chapter 7 bankruptcy in January 2010 and the bankruptcy administrator moved to dismiss the case or convert it to a chapter 13 on the ground that debtors' bankruptcy petition constituted an abuse of the chapter 7 process. The court held that a debtor's ability to pay his or her debts may be taken into account under the totality-of-the-circumstances test set forth in 11 U.S.C. 707(b)(3)(B). Accordingly, the court affirmed the district court's rejection of debtors' argument that the ability to pay could not be considered as part of the totality of the circumstances. View "Witcher, et al v. Early, III" on Justia Law

This appeal arose out of a bankruptcy court proceeding involving the Asbestos Settlement Trust, which was created in bankruptcy court in 1996 to pay asbestos mass tort claims for both bodily injury and property damage against Celotex Corporation and Carey Canada, Inc. Because neither the district court nor the bankruptcy court order was a final judgment or order and because neither order fell within any of the exceptions to this circuit's final judgment rule, the court lacked jurisdiction to review these orders. Accordingly, the court dismissed the appeal. View "Michigan State University, et al v. Abestos Settlement Trust" on Justia Law

The Property Appraiser and the Tax Collector appealed from an order of the district court affirming the final order of the bankruptcy court. The bankruptcy court held that debtor's request for the bankruptcy court to redetermine her ad valorem tax liability for the year 2009 was timely filed under 11 U.S.C. 108(a) and 505. The court concluded that the bankruptcy court erred in ruling that debtor's request was timely under section 108(a). The bankruptcy court's interpretation of the language in section 505(a)(2)(C) failed to give full effect to Congress's intent. Accordingly, the court reversed the judgment of the district court affirming the bankruptcy court's holding. View "Dubov, et al. v. Read" on Justia Law

This case involved unanswered questions of Georgia law that are central to this appeal. Because these questions are determinative of the case and there are no controlling precedents from the Supreme Court of Georgia, the court respectfully certified the following questions for resolution: (1) Whether a security deed that lacks the signature of an unofficial witness should be considered "duly filed, recorded, and indexed" as required by O.C.G.A. 44-13-33, such that a subsequent hypothetical bona fide purchaser would have constructive notice when the deed incorporates the covenants, terms, and provisions of a rider that contains the attestations required by O.C.G.A. 44-13-33 and said rider was filed, recorded, and indexed with the security deed; and (2) If the answer to question one was in the negative, whether such a situation would nonetheless put a subsequent hypothetical bona fide purchaser on inquiry notice. View "Gordon v. Wells Fargo Bank, N.A." on Justia Law

In late 2008, Lou Ann Cassell inherited $220,000 from her aunt. At that time, both Cassell and her wholly owned company, J&L Arborists, LLC, were insolvent. After consulting with attorneys and accountants, she used her $220,000 inheritance to purchase a single-premium fixed annuity. She began receiving monthly payments, and under the annuity contract she is scheduled to receive those payments for the rest of her life. The contract also guarantees the payments for ten years regardless of when Cassell dies. She designated her children as the beneficiaries of the payments if she dies within the ten-year guarantee period. A year after she had purchased the annuity, Cassell and her company filed a Chapter 7 bankruptcy petition. She included the annuity as an asset in her Schedule B disclosures, and listed it as exempt under Georgia law on Schedule C. The trustee objected, contending that Cassell's annuity is nonexempt because it does not meet the requirements of the statute. The bankruptcy court held that Cassell's annuity was an "annuity" within the meaning of the Georgia bankruptcy exemption statute. The district court affirmed as to the issues that the bankruptcy court had addressed but remanded the case, leaving it for the bankruptcy court to decide in the first instance whether the annuity payments were reasonably necessary for Cassell's support. Upon review, the Eleventh Circuit certified the question pertaining to the Georgia exemption to the Georgia Supreme Court. View "Silliman v. Cassell" on Justia Law

The Chapter 7 trustee for the bankruptcy estate of Stacey Williams appealed the district court's grant of summary judgment to Gate Gourmet on Williams' claim of pregnancy discrimination, race discrimination, retaliation, and state law negligence. The court held that the district court improperly granted summary judgment on Williams' Title VII, 42 U.S.C. 2000e et seq., claim for pregnancy discrimination because Williams had presented enough circumstantial evidence to allow a jury to reasonably infer that her supervisor's action in terminating her because of her pregnancy and his inaction in not attempting to find her a light-duty job were a violation of Title VII. The district court properly granted summary judgment to Gate Gourmet on Williams' Title VII and 42 U.S.C. 1981 race discrimination claims because she had not shown a genuine issue of material fact about whether Gate Gourmet intentionally discriminated against her based on her race. Summary judgment was improperly granted against Williams' Title VII and section 1981 retaliation claims because there was a reasonable inference that the statutorily protected filing of and refusal to settle the EEOC charge caused Gate Gourmet to deny Williams a light-duty position, which was a materially adverse action. The court affirmed in part, reversed in part, vacated in part, and remanded. View "Williams v. Gate Gourmet, Inc." on Justia Law