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Thursday, September 24, 2015 – OCBA – Exemptions Case Law and Statutory Update

By | September 15, 2015 | Appeals, Bankruptcy Data, Case Briefs, Cases, Chapter 11, Chapter 13, Chapter 7, Community, Current Events, Programs, Specialist Information | No comments

ORANGE COUNTY BAR ASSOCIATION
COMMERCIAL LAW & BANKRUPTCY SECTION

September Meeting

Exemptions Case Law and Statutory Update
 Learn about 2014-2015 developments regarding exemptions including recent case law imposing the burden of proof on the Debtor and allowed surcharges after Law v. Siegel;
 Discover best practices for maximizing exemptions without risking denial of discharge; and
 The panelists will also discuss proposed Senate Bill 308 increasing the homestead exemption to $300,000 across the board and eliminating the requirement to reinvest exemption proceeds.

D. Edward Hays, Esq., Partner, Marshack Hays LLP
Jeffrey I. Golden, Esq., Partner, Lobel Weiland Golden Friedman LLP Read more…

Most Commercial Speech is Not Activity Protected by California’s Anti-SLAPP Statute.

By | September 7, 2015 | Appeals, Cases, Uncategorized | No comments

On August 20, 2015, the Los Angeles Division District Court was presented with the issue of whether false advertising on the internet was subject to anti-SLAPP protection. The case is In L.A. Taxi Cooperative, Inc. v. The Independent Taxi Owners Association of Los Angeles and a copy can be found here.

Apparently rival cab companies are purchasing pay per click advertisements on leading search engines which purport to be the rival company but really redirect customers to their own websites and numbers. An example is:

Kia Tehrany, director of operations for Yellow Cab, stated that he conducted a search using the terms “‘Yellow Cab Los Angeles.’” The results included the following:

Yellow Cab Los Angeles – Call 800-521-8294 or Book Online!
www.lataxi.com
Our Cabs get you there Fast & Safe.

Tehrany stated that neither the listed telephone number nor the website was owned or controlled by Yellow Cab. Instead, the website contained information related solely to taxi services provided by ITOA.

Read more…

Pop Quiz! How Long After Entry Of Order Confirming A Plan Can The Order Be Revoked? Hint: It’s Not What You Thought!

By | September 6, 2015 | Appeals, Case Briefs, Uncategorized | No comments

If an order confirming a Plan of Reorganization is procured by fraud, how many days from entry of order does one have to ask the court to revoke the order?

The answer depends on which chapter of the Bankruptcy Code we’re talking about! In a Chapter 12 or Chapter 13 case, one would have up to the 180th day after the date the order was entered to seek revocation of the discharge. In a Chapter 11 case, one would have up to the 179th day after the date the order was entered to seek revocation. That is a pretty tough lesson to learn the hard way.

Read more…

Sometimes Complete Disclosure, Disinterestedness and an Approved Employment Application are Not Good Enough!

By | September 3, 2015 | Case Briefs, Cases | No comments

On August 24, 2015, Judge Lee, a Bankruptcy Judge in the Eastern District of California, disqualified the Estate’s general bankruptcy counsel even though counsel was properly employed under § 327(a). The Court found that counsel was a disinterested person within the meaning of the code and did not hold or represent an interest adverse to the estate. This is a wild (but proper) result because under California law, a client’s waiver or consent can cure these types of deficiencies and under Bankruptcy law, those defects cannot be cured!

So how is it that under Bankruptcy law, counsel was properly employed but had to be disqualified under California law?

Read more…

Tenants Beware: Stipulation to Judgment May Be Treated as Res Judicata

By | September 2, 2015 | Appeals, Cases | No comments

This blog is a quick review of Needelman v. DeWolf Realty Company which was entered on July 21, 2015.

The tenant entered into a stipulated judgment that specifically provided that Tenant waived “any claims he may have, which [the lessors] assert do not exist, to bring an attempted wrongful eviction against [the lessors] or any action in any way arising out of or concerned with his tenancy…” and stated that Tenant “agrees that any of his personal property remaining in the unit after he vacates or is evicted therefrom shall be considered abandoned property, and [the lessors] shall be entitled to dispose of it without any notice to Tenant or his attorney.”

Read more…

9th Circuit Applies California Law to Contract Where Parties Agreed to Apply Georgian Law

By | September 1, 2015 | Appeals, Case Briefs, Cases | No comments

The basic facts of the case are an individual entered into an agreement with a bank located in Georgia to borrow money to purchase her home. It is not clear whether the individual even signed the contract or where the contract was signed but it ends up not mattering because the bank sued in California District Court under diversity jurisdiction. Note: in California, if a contract contains an attorney fees clause provision, both sides of the dispute get to use it. That’s not the law in Georgia. The Bank wanted to be able to enforce its attorney fee clause against litigants but to not allow other litigants to use that clause against the bank!

California law was applied to this contract in two instances.

Read more…

Learning New Words from the 9th Circuit – Risible

By | August 30, 2015 | Cases | No comments

In Blixseth v. Yellowstone Mountain Club LLC  (In re Blixseth),  — F. 3d — (9th Cir. August 2015), the 9th Circuit published an “Order re OSC on Sanctions” so you know where this is going.  I love this quote:

“[A]ll argue that the appeal was not frivolous because one could have inferred that the bankruptcy judge was biased against [the debtor] from the nineteen accusations that they raised.  As explained in our opinion and order to show cause, we find this argument risible.”

Risible?  One definition:  such as to provoke laughter.  Another definition: provoking laughter through being ludicrous.

6th Circuit Holds That FDCPA Protects Corporations

By | August 25, 2015 | Appeals, Cases | No comments

The FDCPA is a powerful piece of legislature designed to eliminate abusive debt collection practice. The teeth behind the act are an attorney fees clause and provisions that allow for emotional distress and punitive damages to be awarded.

One distinction between consumer debt collectors and commercial debt collectors is that those practicing consumer debt collections had to be very careful not to violate the FDCPA while commercial debt collectors did not have the same worries. Consumers are not as sophisticated as those engaged in business and so this additional protection makes sense.

That distinction now blurred because the 6th Circuit held that corporations may take advantage of the FDCPA.  This is a BIG deal.

You can find the case here.

Hat tip to Professor Dan Schechter, Loyola Law School, Los Angeles and the ABA’s Insolvency Law Committee.

Landlords Are Entitled To Priority Treatment of Lease Payments Which First Come Due During the Gap Period of an Involuntary Bankruptcy

By | August 20, 2015 | Case Briefs, Chapter 11 | No comments

In a case of first impression, Judge Montali had to decide whether a landlord’s claim for payment of rent during the gap period of a personal bankruptcy is entitled to priority.

Before delving into the facts of the case, a quick primer is appropriate. The treatment of a commercial landlord’s claims in bankruptcy is too complicated and will be discussed in more depth in a future article so this “quick primer” is very limited.

When a company files for bankruptcy, the landlord in a nonresidential context is usually the most powerful player in the scene. The landlord is entitled to be paid contract rate lease payments until the Debtor decides to either reject or assume the lease. This is provided for under § 365(d)(3) which states that “The trustee shall timely perform all the obligations of the debtor … arising from and after the order for relief under any unexpired lease of nonresidential real property … until such lease is assumed or rejected, notwithstanding section 503 (b)(1) of this title….” Read more…

Not All Expenses Of A Professional May Be Compensable By The Estate, Even In The Face Of A Clear Retainer Agreement And An Approved Employment Application!

By | August 19, 2015 | Case Briefs, Cases | 2 Comments

The facts of the situation are not in dispute. The Debtor in a Chapter 11 case needed to hire a forensic accountant. The Debtor applied for permission to hire the accountant under § 327(a) of the Bankruptcy Code. The employment application did not contain any special provisions but the engagement letter contained the following clause:

In the event we are requested or authorized by Debtor or are required by government regulation, subpoena, court order, or other legal process to produce our documents or our personnel as witnesses with respect to our engagements for Debtor, Debtor will, so long as we are not a party to the proceeding in which the information is sought, reimburse us for our professional time and expenses, as well as the fees and expenses of our counsel, incurred in responding to such requests.

No objection to employment was filed and the Court entered an order approving the application. Read more…

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