If a time-traveler had visited me in the mid-1990s and told me that I would attend law school, I wouldn’t have believed it.  If that visitor told me that I would graduate and subsequently become a bankruptcy lawyer, I would have said “that’s an oddly-specific prediction, but I still don’t believe you.”  If the time-traveler then told me that the 1996 bankruptcy of then-model/actress Anna Nicole Smith would haunt me and other bankruptcy lawyers with vexing constitutional questions for the ensuing 20 years, and would entail three (and counting!) trips to the Supreme Court, I would have checked myself into a mental institution.

Creditors' Sidebar
(posted 5 days 13 hours ago)

In “How Much Can I Add to My Claim? (says Lender) How Much Liquidity Will I Have? (says Reorganizing Debtor): On the Payment of Post-Petition Interest,” the Editorial Staff of Commercial Bankruptcy Litigation discusses how a secured creditor’s claim in a chapter 11 reorganization may be increased because the debtor’s good work enhanced collateral value – and how the debtor might lessen that pain and preserve precious liquidity under a plan.
To read the article click here or visit www.commercialbankruptcylitigation.com for more information.

(posted 5 days 14 hours ago)

There is an easy fix for the student loan debt crisis.  Bankruptcy laws should be restored to give back to the bankruptcy courts the responsibility of deciding whether or not to give relief to give individuals who claim they can’t pay. We need to take this out of the hands of the bureaucracy in the Department of Education. The bankruptcy courts were in charge of the process before there ever was a student loan bubble. In a nutshell, bankruptcy used to discharge student loans. That is, provided the borrower had owed the money for a specified length of time and had proved the inability to pay anything back. Borrowers who don’t want to expose themselves to the strictures of the bankruptcy process should continue to owe what they borrowed.

It was ill advised policy to take bankruptcy law out of the student loan relief equation. (A tiny exception remains for the almost impossible to achieve “undue hardship” bankruptcy discharge). The present crisis is the fruit of that ill advised policy change. The elimination of a bankruptcy discharge removed an important safety valve which used to protect the economy from the explosive pressures now referred to as a student loan debt bubble.

We can fix the problem with no need to expand the court system.

Los Angeles Bankruptcy Blog
(posted 5 days 15 hours ago)

Banks can ensure that their oversight teams help to propel the whole company forward by creating a thorough governance structure and hiring overseers with experience in key business lines.

BankThink
(posted 5 days 18 hours ago)

Republic of Texas Brands Inc., which exited Chapter 11 bankruptcy protection earlier this month, is blazing a new trail in Texas.
The company plans to change its name to Totally Hemp Crazy and complete a merger with Chill Texas Inc., the distributor of a cannabis-based energy drink made in Austria.
“The completion of the acquisition is in process and will be completed before the end of the month,” Tom Shuman, a 30-year veteran of the beverage industry and the company’s new chief executive, said in a statement Tuesday.
The new name reflects the company’s renewed focus on THC-free, cannabis-based beverages like its Chillo energy drink, which promises consumers “a whole new feeling of being alive.”

WSJ.com: Bankruptcy Beat
(posted 5 days 18 hours ago)

Discounted cash flow analysis is a mainstay among the valuation methodologies used by restructuring professionals and bankruptcy courts to determine the enterprise value of a distressed business. Despite its prevalence, the United States Bankruptcy Court for the Southern District of New York recently concluded the DCF method was inappropriate for the valuation of “dry bulk” shipping companies. In re Genco Shipping & Trading Limited. Although the bankruptcy court merely applied existing law to the facts of the case, the decision in Genco could serve as precedent for the valuation of companies in other segments of the shipping industry, or other industries, that experience significant volatility in rates.
Genco and the Prepackaged Plan of Reorganization
Genco Shipping & Trading Limited is a leading provider of maritime transportation services for “dry bulk” cargoes, such as iron ore, coal, grain, and steel products. Through its subsidiaries, Genco owns and operates a fleet of 53 vessels, which it contracts out to third-parties under fixed-rate or spot-market time charters.

(posted 5 days 18 hours ago)

In re Ormet Corp., No. 13-10334 (MFW), 2014 WL 3542133 (Bankr. D. Del. July 17, 2014)
In this Memorandum Opinion, Judge Walrath overruled an objection to a sale of the debtors’ assets free and clear of the objector’s successor liability claim, and granted a stay waiver under Bankruptcy Rules 6004(h) and 6006(d) to allow the sale to close immediately.  In reaching its conclusion, the Court emphasized the integral nature of Bankruptcy Code section 363(f) to the bankruptcy process, enabling debtors to sell assets free and clear of any claims—something not available outside of the bankruptcy context. Read More ›
Tags: 363 Sales, Waiver of 14-Day Stay

Delaware Bankruptcy Insider
(posted 5 days 19 hours ago)

Banc of CaliforniaÂ's proposed acquisition of 20 Banco Popular branches offers an opportunity for regulators to ensure that underserved customers and communities are not left behind in bank deals, writes Paulina Gonzalez of the California Reinvestment Coalition.

BankThink
(posted 5 days 20 hours ago)

Energy Future Holdings Corp. is terminating the restructuring support agreement it brought with it when it filed for Chapter 11 bankruptcy in April and making plans for an auction, according to a Thursday filing with the Securities and Exchange Commission. 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.”)
A federal grand jury indicted TelexFree LLC co-founders and owners James Merrill and Carlos Wanzeler Wednesday on fraud charges tied to allegations that their company operated a massive pyramid scheme. The DBR article is available on WSJ.
The state of Florida has filed a lawsuit against former executives of Digital Domain Media Group Inc., saying the movie-special-effects company was essentially a Ponzi scheme that defrauded the state out of more than $80 million in job-creation grants. Read the DBR article via WSJ.

WSJ.com: Bankruptcy Beat
(posted 5 days 20 hours ago)

Receiving Wide Coverage ... Deutsche Bank's Troubles: The news of the New York Fed's stern rebuke to Deutsche Bank over its questionable financial data has industry observers making bets on the fallout. Deutsche Bank's chief financial officer, Stefan Krause, is now in the hot seat, according to the Wall Street Journal. Krause launched an effort to whip the bank's financial data into shape in 2010, but progress has been slow. Krause is far from the bank'sÂ...

BankThink
(posted 5 days 21 hours ago)