Basics of Bankruptcy Litigation for the Non-Bankruptcy Litigator Webinar Now Available On Demand!
This webinar is designed for the commercial litigator who is about to litigate in bankruptcy court for the first time.  It presents the big picture differences between litigating in bankruptcy court.
Click here to register.

(posted 1 day 2 hours ago)

Due Diligence in Real Estate Deals Webinar Now Available on Demand!
This webinar is a must-attend for anyone who will be representing a client in any type of real estate transaction. Learn the proper guidelines that must be met to prove diligence.  Our expert panel will discuss what you must avoid in order steer clear of pitfalls that could destroy your reputation and career.
Click here to register.

(posted 1 day 5 hours ago)

Three-and-a-half years after Howrey LLP shut its doors, another 31 former partners of the bankrupt law firm have agreed to chip in money to pay back Howrey’s creditors.
In settlement papers filed Friday in U.S. Bankruptcy Court in San Francisco, Howrey trustee Allan Diamond says he’s reached deals to bring in close to $1.5 million from the batch of onetime equity partners. That’s on top of a nearly identical settlement reached in May with 60 ex-partners that raised $4.2 million for creditors.
The contributions, ranging from $3,532 to $200,000, claw back 16% of what partners earned between April 2010 and Howrey’s dissolution a year later—a period during which Mr. Diamond argues Howrey was insolvent.
“This one really takes us dramatically far down the road with respect to the former partners,” Mr. Diamond, a name partner at Texas firm Diamond McCarthy LLP, told Bankruptcy Beat on Monday. Settlement talks continue, he said, with a large group of lawyers who landed at Jones Day, and a handful of “stragglers” are also out there. (A Jones Day rep didn’t immediately respond to a request for comment Monday).

WSJ.com: Bankruptcy Beat
(posted 1 day 8 hours ago)

Yoga for lawyersAnd now time for something entirely different. I noticed a great new book in our list of library acquisitions recently that might be of particular interest to two groups that suffer from lots of stress: lawyers and debtors! Credit Slips' own Nathalie Martin has teamed up with a lawyer-turned-yogi and the ABA to produce a really wonderful new book, Yoga for Laywers: Mind-Body Techniques to Feel Better All the Time. The book contains a very nice discussion of stress, its causes and effects, and its relief through yoga poses, mindfulness and meditation.  I've read a lot of these kinds of books, and this one stands out as particulary clear and readable. Moreover, the yoga section is extraordinarily accessible.

Credit Slips
(posted 1 day 11 hours ago)

A.        Introduction
Over the past decade, debtors have increasingly used the protections of Chapter 11 to sell substantially all of their assets in sales under section 363 of the Bankruptcy Code.  As a result, post-sale debtors frequently have next to nothing left to reorganize or liquidate.  Historically, post-sale debtors had only three options for wrapping up their bankruptcy cases: (1) confirming a liquidating plan of reorganization; (2) converting to Chapter 7 and liquidating remaining assets; or (3) dismissing the bankruptcy case in strict accordance with section 1112(b) of the Bankruptcy Code.
Those three options are frequently unappealing and economically impractical considering post-sale debtors often have so few remaining assets that they cannot pay their post-petition expenses.  For example, the costs and delays of filing, confirming, and administering a liquidating plan of reorganization may easily exceed any net proceeds that would otherwise have been available to distribute to unsecured creditors.  Likewise, the costs and delays associated with converting a case to Chapter 7 may result in a significant reduction of assets previously available to distribute to creditors.  Finally, a strict dismissal may result in a disorderly distribution of a debtor’s remaining assets as creditors scramble to be first to enforce state law rights and remedies against the debtor.

Insolvency Insights
(posted 1 day 11 hours ago)

We previously covered the Meridian Sunrise Village case on the Bankruptcy Blog here. As you may remember, this case turned on a choice between two competing interpretations of “financial institution” under a $55 million loan agreement governed by Washington state law.
Distressed debt funds in this case had sought to acquire the debt of a troubled borrower from an existing lender, something they were only able to do if they were an “Eligible Assignee” under the terms of the loan agreement between the borrower and its lenders. The distressed debt funds argued that they were Eligible Assignees, as the definition of “Eligible Assignee” in the loan agreement included “financial institutions.” The borrower argued that the distressed debt funds were not financial institutions as it is commonly understood, and therefore were not “Eligible Assignees.”

(posted 1 day 12 hours ago)

A reform intended to reduce risk in the financial system could inadvertently exacerbate future economic downturns.

BankThink
(posted 1 day 13 hours ago)

Shareholders were asked to vote on almost 1,200 equity plan proposals in the first half of 2014, according to the ISS U.S. Proxy Season Review Report, with an average approval rate of 89%. Slightly more than half of the proposals amended existing plans, while 150 proposals were made solely to comply with Section 162(m) tax deductibility and did not ask for any increased shares.

(posted 1 day 13 hours ago)

The debt-stricken operator of an Indiana Toll Road filed for bankruptcy protection Sunday with a plan to get restructure some $6 billion debt by selling its assets or, alternatively, reorganizing its business. Read the Daily Bankruptcy Review article here.
(Daily Bankruptcy Review is a daily newsletter with comprehensive coverage and analysis of emerging and in-progress insolvencies and turnarounds. For a two-week trial, visit our homepage, scroll to the bottom and click “try for free.”)
Power-plant owner Entegra Power Group LLC won swift confirmation Friday of a Chapter 11 plan that chops $750 million worth of debt from its $1.5 billion balance sheet. Read the DBR article via The Wall Street Journal.
The bidding is now open on Energy Future Holdings Corp.’s rights to Oncor, a Texas transmission business that’s going up for grabs in bankruptcy, DBR reports via WSJ.

WSJ.com: Bankruptcy Beat
(posted 1 day 13 hours ago)

Wall Street Journal

Federal officials are considering how to instruct lenders to ease up on tight lending standards for mortgages. On the one hand, they don't want to create another housing bubble. But on the other hand, mortgage lending is so slow because lenders have adopted standards that are even tighter than what Fannie Mae and Freddie Mac demand. Underlying all of this are paltry-to-nonexistent wage growth, high levels of student debt and little savings for...

BankThink
(posted 1 day 15 hours ago)