Justia Bankruptcy Opinion Summaries

The Fourth Circuit reversed the district court's dismissal of BLC's appeal of the bankruptcy court's confirmed reorganization plan for debtor. The court held that BLC's appeal was not equitably moot. On the merits, the court held that the bankruptcy court did not err in calculating the indubitable equivalent of BLC's claim or in calculating the amount of post-petition interest due to BLC. Therefore, the court affirmed the bankruptcy court's judgment. View "Bate Land Company LP v. Bate Land & Timber LLC" on Justia Law

Section 362(k)(1) of the Bankruptcy Code specifically departs from the American Rule and authorizes costs and attorneys' fees incurred by the debtor in ending a willful violation of an automatic stay, prosecuting a damages violation, and defending those judgments on appeal. In this case, the Eleventh Circuit affirmed the district court's order awarding defendants attorneys' fees and costs that they incurred because of plaintiff's unsuccessful appeal of the damages award to defendants for her violation of the Bankruptcy Code's automatic stay provision. The court also granted defendants' motion for attorneys' fees incurred in this appeal. View "Mantiply v. Horne" on Justia Law

The First Circuit affirmed the district court’s judgment affirming the bankruptcy court’s ruling that the largely debt-financed purchase of a family-owned leather manufacturer was not a fraudulent conveyance and was not a violation of the fiduciary duties of the company’s directors.The trustee of a trust established to benefit the creditors of several related insolvent entities filed a complaint alleging that the transaction at issue was a fraudulent conveyance and that the company’s directors were in breach of their fiduciary duties by approving it. The bankruptcy court ruled in the defendants’ favor on every count. The district court affirmed, holding that the bankruptcy court’s factual determinations were not clearly erroneous, and the bankruptcy court found sufficient facts to support its conclusions. View "Development Specialists, Inc. v. Kaplan" on Justia Law

The M/V Deep Blue purchased fuel from a supplier, the supplier purchased the fuel from an affiliate, and the affiliate subcontracted with Radcliff. Radcliff subsequently asserted a maritime lien on the Deep Blue in a bid to recover directly from the ship, giving rise to this litigation. The Fifth Circuit affirmed the district court's determination that Radcliff did not have a lien on the Deep Blue. Instead, a lien had arisen in favor of the global fuel supplier, and was duly assigned to ING Bank, an intervenor in the suit. View "Barcliff, LLC v. M/V Deep Blue" on Justia Law

Debtor filed several unsuccessful lawsuits to invalidate Sandlin Farm's Deutsche Bank mortgage. Debtor, d/b/a Sandlin Farms sought Chapter 12 bankruptcy relief but did not propose to pay that mortgage nor a BoA mortgage on other property. Debtor filed adversary complaints to avoid the liens. The Trustee moved to dismiss the case due to inaccurate monthly reports and Debtor’s inability to generate sufficient income to implement his plan if the liens were valid. The Bankruptcy Court dismissed the Deutsche Bank adversary proceeding, citing res judicata. Debtor voluntarily dismissed the BoA proceeding but did not re-notice the confirmation hearing or amend the plan. The court denied Debtor’s motion to stay pending appeal of the Deutsche Bank dismissal and set a hearing on the Trustee's motion. Debtor resisted scheduling depositions and requested time to find new counsel. The Trustee then sought Dismissal as a Sanction for Failure to Cooperate with Discovery. Debtor did not appear at the hearing. The Bankruptcy Court dismissed (11 U.S.C. 1208(c)) based on inability to present a timely confirmable plan; unreasonable delay; and a continuing loss to the estate without reasonable likelihood of rehabilitation. The Bankruptcy Appellate Panel affirmed. Although Debtor had actual notice of the hearing, it was not reasonably calculated to give him sufficient notice of exactly what issues would be addressed nor an opportunity to be heard. Nonetheless, Debtor failed to refute that cause existed to dismiss the case, so the error was not prejudicial. View "In re: Haffey" on Justia Law

Under Gibbs v. Legrand, post-discovery delay does not preclude equitable tolling but is still relevant to assessing a party's "overall diligence." The Ninth Circuit affirmed the Bankruptcy Appellate Panel's decision reversing the bankruptcy court's dismissal as time-barred of a bankruptcy estate's claims seeking avoidance of fraudulent transfers and affirming the bankruptcy court's dismissal of other claims based on transfers not made by debtor. The panel held that neither court correctly applied the law on equitable tolling. In this case, the estate's overall diligence, combined with the extraordinary circumstances preventing earlier discovery of the subject transfers, warranted equitable tolling. View "Milby v. Templeton" on Justia Law

The district court did not abuse its discretion in denying Appellant’s motion for extension of time to file notice of appeal pursuant to Bankruptcy Rule 8002(d)(1)(B) for failing to show excusable neglect. Appellant filed her motion one business day late as a result of her attorney’s preoccupation with his second job as a church’s music director. The district court concluded that counsel’s explanation for the delay amounted to mere inadvertence and did not constitute excusable neglect. The First Circuit affirmed, holding that the district court did not abuse its discretion in finding that Appellant’s counsel’s inadvertence did not constitute excusable neglect and that Appellant was bound by counsel's carelessness. View "Sheedy v. Bankowski" on Justia Law

The Bankruptcy Appellate Panel affirmed the bankruptcy court's order remanding an adversary proceeding brought against debtor by the Law Firm. The panel held that the bankruptcy court did not abuse its discretion by committing a clear error of judgment in weighing the listed criteria. In this case, the bankruptcy court's analysis demonstrated its exercising jurisdiction would not resolve any bankruptcy issue or serve any bankruptcy purpose that was not at least equally well-served by remanding the matter to the state court. The court rejected debtor's arguments to the contrary and affirmed. View "Zahn Law Firm, P.A. v. Baker" on Justia Law

The First Circuit affirmed an order of the bankruptcy court denying Appellant Chapter 7 discharge on the grounds that she made material, knowing, and fraudulent false oaths in the course of her bankruptcy proceedings. The bankruptcy judge concluded that the failure of Appellant, an attorney, to disclose two lawsuits to which she was a party indicated that she had not filed her bankruptcy case in good faith. The United States Bankruptcy Appellate Panel for the First Circuit affirmed. Thereafter, the bankruptcy judge denied Appellant’s discharge, concluding that she had acted with reckless indifference to the truth by failing to disclose the two lawsuits in a timely manner. The district court affirmed. The First Circuit also affirmed, holding that the bankruptcy judge did not clearly err in finding that Appellant had made false statements with reckless indifference to the truth. View "Zizza v. Harrington" on Justia Law

The Supreme Court reversed the judgment of the trial court in favor of Defendant on Plaintiff’s complaint and Defendant’s counterclaim for damages and declaratory judgment. This case stemmed from a purchase agreement entered into by the parties in which Plaintiff was to provide various equipment and services to Defendant for a telecommunications switch room. The Supreme Court held (1) the trial court incorrectly concluded that Plaintiff breached the purchase agreement by filing a petition for bankruptcy protection under chapter 11 of the United States Bankruptcy Code; and (2) the trial court erred in determining that Defendant was within its rights to terminate the purchase agreement upon Plaintiff’s initiation of bankruptcy proceedings. View "CCT Communications, Inc. v. Zone Telecom, Inc." on Justia Law