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Weekly Caselaw Updates

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Cascade Funding Mortg. Trust v. Smeltzer

This case had a procedural history only a bankruptcy attorney could stomach. In 2011, the Smeltzers filed a Chapter 13 bankruptcy petition to restructure their debt. In April 2014, the mortgage lender filed a certificate of default claiming that the Smeltzers had defaulted under the terms of a stipulation and…

Cascade Funding Mortg. Trust v. Smeltzer
Pennsylvania Superior Court

This case had a procedural history only a bankruptcy attorney could stomach. In 2011, the Smeltzers filed a Chapter 13 bankruptcy petition to restructure their debt. In April 2014, the mortgage lender filed a certificate of default claiming that the Smeltzers had defaulted under the terms of a stipulation and requested relief from the bankruptcy… Continue reading Cascade Funding Mortg. Trust v. Smeltzer

In re W.R. Grace & Co.
3rd Circuit

Section 524(g) enables bankruptcy courts handling asbestos-related companies’ cases to establish a trust for future claimants against the debtor company as part of the debtor company’s reorganization plan. Through the resulting channeling injunction, Section 524(g) diverts all claims against the debtor to the trust. Certain third parties can also benefit from a Section 524(g) channeling… Continue reading In re W.R. Grace & Co.

In re Aleckna
3rd Circuit

Student debt and sour grapes are the topics of this Third Circuit opinion. When Aleckna filed for Chapter 13 bankruptcy, she had completed her coursework but still owed California Coast University (“CCU”) tuition. The filing of her bankruptcy petition, however, imposed an “automatic stay” of all collection actions against her, and therefore enjoined CCU from… Continue reading In re Aleckna

Ellis v. Westinghouse Elec. Co., LLC
3rd Circuit

Dates matter in bankruptcy proceedings. Ellis worked for Westinghouse. About two months after the New York Bankruptcy Court confirmed Westinghouse’s Chapter 11 plan of reorganization (“the Plan”), Westinghouse terminated Ellis’s employment, explaining that his department was being restructured. Ellis believed he was unlawfully fired due to his age. So, he filed a charge with the… Continue reading Ellis v. Westinghouse Elec. Co., LLC

In re LTC Holdings, Inc.
3rd Circuit

The Department of Defense awarded a general contracting firm the contract to construct the National Police Command Center in Afghanistan. As is typically required in government contracts, the general contractor was required to secure performance and payment bonds that guarantee the contractor will properly perform its contract and pay its subcontractors. Here, the general contractor… Continue reading In re LTC Holdings, Inc.

Bisbing v. Bisbing
New Jersey Appellate Division

After a divorce and child custody action, the trial court awarded attorney’s fees in favor of the defendant. The plaintiff soon thereafter filed two bankruptcy petitions. Both bankruptcy petitions were dismissed. Defendant sought an order finding the attorney’s fees to be non-dischargeable in bankruptcy as a “domestic support obligation.” The lower court agreed with the… Continue reading Bisbing v. Bisbing

In re Venoco LLC
3rd Circuit

In Central Va. Cmty. Coll. v. Katz, 546 U.S. 356 (2006), the U.S. Supreme Court held that, by ratifying the Bankruptcy Clause of the U.S. Constitution, states waived their sovereign immunity defense in proceedings that further a bankruptcy court’s exercise of its jurisdiction over property of the debtor and its estate. In the case of… Continue reading In re Venoco LLC

In re Weinstein Co. Holdings LLC
3rd Circuit

The Third Circuit issued two nearly identically captioned opinions — In re Weinstein Co. Holdings LLC — in which the Court dealt with issues revolving around Harvey Weinstein’s bankruptcy proceedings. When The Weinstein Company (TWC) declared bankruptcy, it found a buyer in the Spyglass Media Group. In one case, the Third Circuit heard an appeal… Continue reading In re Weinstein Co. Holdings LLC

In re Orexigen Therapeutics, Inc.
3rd Circuit

The Third Circuit used In re Orexigen Therapeutics, Inc. to clarify the meaning of “mutual” in the Bankruptcy Code provision that allows parties to invoke setoff rights when the debts they owe one another are mutual. Two companies wanted to setoff their debts to a company proceeding through bankruptcy according to a prior contact that… Continue reading In re Orexigen Therapeutics, Inc.

In re Energy Future Holdings Group
3rd Circuit

In re Energy Future Holdings Group arose from the bankruptcy of Energy Future Holdings and its affiliates (“Debtors”). The Debtors’ most valuable asset was a significant economic interest in Texas’s largest electric and power transmission and distribution company, which Appellant NextEra Energy Inc. agreed to buy through a Merger Agreement. The sale did not go… Continue reading In re Energy Future Holdings Group