From time to time it has proved beneficial to revisit existing bankruptcy statutes, and update them where necessary. The American Bankruptcy Institute established the Commission to Study the Reform of Chapter 11 (the “Commission”) for this precise purpose, and on December 8, 2014 the Commission published its recommendations. If enacted by Congress, some of those recommendations might affect a trustee’s ability to avoid and recover preferential transfers under Bankruptcy Code section 547.
The primary goals of preference law are (i) to equalize distribution, and (ii) to maximize estate value. As originally contemplated, a trustee could recover payments or property transferred to creditors prepetition to the extent those transfers preferred such creditors over other similarly situated creditors. The trustee would then distribute the recovered value to all similarly situated creditors.

Insolvency Insights
(posted 19 hours 28 min ago)

Binder & Binder, one of the nation’s largest Social Security disability firms, filed for bankruptcy protection Thursday night amid shrinking demand for its services as government scrutiny of disability claims tightens. The Wall Street Journal has 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.”)
The union representing more than 1,000 workers at the Trump Taj Mahal casino on Thursday accused billionaire Carl Icahn of backing out of a deal that would have saved the endangered Atlantic City gambling hall. Read the DBR article in WSJ.
DBR reports in WSJ that a $1 billion pact between Nortel Networks Corp.’s U.S. unit and bondholders won court approval Thursday over the protests of the one-time Canadian technology giant.

WSJ.com: Bankruptcy Beat
(posted 19 hours 34 min ago)

Wall Street Journal Fresno, Calif.: home of raisin farms, a college football team called the Bulldogs, and (who knew?) a federal prosecutor's office that dug up the memo that led to $37 billion in bank fines stemming from the subprime mortgage crisis. The Journal reports on Richard Elias, an assistant U.S. Attorney who discovered JPMorgan Chase documents while working in the Justice Department's Fresno office that led to successful prosecutions of big banks. The JPMorgan memosÂ...

BankThink
(posted 19 hours 48 min ago)

Weiss v. JPMorgan Chase Bank, N.A. (In re Thibault), 518 B.R. 635 (Bankr. D. Mass. 2014) – A chapter 7 trustee sought to avoid a mortgage using his “strong-arm” powers on the basis that it was not properly recorded because the spelling … Continue reading →

(posted 22 hours 17 min ago)

I've been remiss in cross-posting my Dealb%k columns. Both of the most recent ones have commented on the ABI's chapter 11 reform proposal. You can find them here.

Credit Slips
(posted 23 hours 42 min ago)

“How to Lie With Statistics” has sold more than 500,000 copies since it was written by Darrell Huff in 1983. It remains a strong seller on Amazon, though the text (but not the pictures) is available for free (the pictures are necessary, really). Read more here.
Print

(posted 1 day 15 hours ago)

The following article was written by Kenneth R. Epstein and Nelly Almeida and originally published in the December 8, 2014 edition of the New York Law Journal.  Kenneth Epstein is the Managing Director of the Insured Portfolio Management Special Situations Group at MBIA Insurance Corporation. A link to the journal can be found here.” 
A successful restructuring depends, in part, on disclosure by a debtor of information pertaining to its finances and operations. This feature, however, is notably absent in most municipal bankruptcies. Chapter 9 of the Bankruptcy Code, available to municipalities seeking to reorganize their debts, imposes few statutory requirements on municipal debtors. Additionally, federal courts have been careful not to interfere with the affairs of a municipality due to the inherent constitutional limitations on courts’ powers. The absence of mandatory disclosures by municipal debtors often creates inefficiencies and increased costs during a bankruptcy process and should, therefore, be addressed. This article compares and contrasts Chapter 11 and Chapter 9 disclosure requirements and discusses a bankruptcy court’s ability to compel greater disclosure from municipal debtors under the current Chapter 9 framework.
A Comparison of Disclosure Requirements

(posted 1 day 15 hours ago)

The repeal of the swaps push-out provision will reduce banks' operational costs, but it makes little difference in terms of increasing the size of the government safety net. The reason: with or without the rule, the government protects the swaps contracts of the largest institutions.

BankThink
(posted 1 day 18 hours ago)

Nearly $600 million worth of settlements to benefit victims of Bernard Madoff’s massive Ponzi scheme on Wednesday won the blessing of a bankruptcy judge. The Wall Street Journal has 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.”)
Fourteen people involved with the pharmacy connected to a meningitis outbreak, the New England Compounding Center, had charges announced against them, WSJ reports.
WSJ reports that four executives at Freedom Industries, the West Virginia company behind a massive chemical spill, were charged in the chemical leak.

WSJ.com: Bankruptcy Beat
(posted 1 day 19 hours ago)

Bernstein-Burkley, P.C. Managing Partner, Robert S. Bernstein, discusses the different […]
The post 5 Minute Legal Master Series: Reviewing a New Commercial Collections Claim appeared first on Bernstein-Burkley, P.C..

Bernstein-Burkley, P.C.
(posted 1 day 19 hours ago)