New Cases For the Week of December 15, 2003 - December 18, 2003

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December 19, 2003

Case

Court

Holding

In re Bogan
(DBN Subscription Required)
Bankr.  W.D. Pa. A postpetition embezzlement victim who is unable to trace the embezzled funds to funds in the possession of, or distributed by, a bankruptcy trustee, is not entitled to recoupment, a constructive trust, an equitable lien or reclamation.
In re Bogan
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Bankr. W.D. Pa. The shield of exemption may be penetrated in extreme circumstances where there is fraudulent conduct or a clear showing of bad faith. A debtor's postpetition, undisclosed embezzlement from her employer constituted such extreme circumstances, disqualifying the debtor from any exemption rights.

December 18, 2003

Case

Court

Holding

Bethea v. Robert J. Adams & Associates
(DBN Subscription Required)
7th Cir. Pre-petition debts for legal fees are subject to discharge under §727 even if services are performed or owed postpetition.
In re ATD Corp.
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6th Cir. Even if a bankruptcy court has any ability to override the "deemed filed" effect of a scheduled claim through a bar date order (which the court declined to decide), the bar date order issued in this case could not achieve that result.
In re Continental Airlines, Inc. et al.
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Bankr. DE An appellate decision holding that CBA claims against a debtor's estate were discharged, but that the employees' right to arbitrate was not extinguished (due to the debtor's failure to reject the CBA), permitted the employees to proceed with the arbitration. 
In re Mariner POst-Acute Network, Inc.
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Bankr. DE A claim for indemnity under a prepetition agreement but based upon postpetition events is a prepetition claim, subject to discharge.

December 17, 2003

Case

Court

Holding

In re Berkshire Foods, Inc.
(DBN Subscription Required)
Bankr. N.D. Ill. Where a debtor settles a claim that may be covered by insurance by agreeing with the claimant on the amount of the claim but further agreeing that the claimant will seek recovery only from the insurance company and not from the debtor, the insurance company is entitled to have the order approving the settlement revoked where the insurance company was not given notice of the original settlement.
In re Wheeler
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Bankr. N.D. Tex. Where a State court money judgment arising from a bench trial on multiple causes of action did not include any findings of fact, the judgment could not form the basis for a collateral estoppel bar in a later dischargeability action against the judgment debtor.  It was impossible for the bankruptcy court to determine the causes of action upon which the judgment had been entered.
In re DeLong
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Bankr. C.D. Ill. A bankruptcy filing occurs when the petition is received and docketed, not when the petition is mailed.

December 15, 2003

Case

Court

Holding

In re O'Brien
(DBN Subscription Required)
9th Cir. The Bankruptcy Court did not err in dismissing a dischargeability action brought by George Harrison against his manager when Harrison refused to submit himself for deposition.
In re Burley
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Bankr. W.D. Mo. Time for determining a debtor's exemption is the time of filing.
In re Coram Healthcare Corp.
(DBN Subscription Required)
Bankr. De. A postpetition action by a bankruptcy estate against a tird party is a core proceeding since it is a matter concerning the administration of the estate.

Unless a bankruptcy court's jurisdiction is based solely on diversity, section 1391(b), rather than section 1391(a), governs venue of an adversary proceeding.

Venue in a postpetition breach of contract action between a bankruptcy estate and a third party is not proper in the district presiding over the main bankruptcy case unless: (i) that district is where the events forming the basis for the lawsuit occurred or (ii) that district is where all defendants reside (if all defendants are form the same State).

U.S. v. State Street Bank and Trust Co.
(DBN Subscription Required)
Bankr. De. A postconfirmation claimant cannot be be barred by res judicata arising from a confirmed plan.
Jackson v. Kincaid
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Tex. Crt. App. Lawyers' pro hac vice appearances in a Texas bankruptcy case established minimum contacts with the State of Texas for the purpose of asserting in personam jurisdiction over the lawyers in a Texas lawsuit.
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