New Cases - Week of June 28, 2004

In re Witko (DBN Subscription Required)	7th Cir.	Pre-petition causes of action are part of the bankruptcy estate and post-petition causes of action are not. Federal law, not State law, determines whether an interest is property of the bankruptcy estate. However, property interests are created and defined by state law, and unless some federal interest requires a different result, there is no reason why such interests should be analyzed differently simply because an interested party is involved in a bankruptcy proceeding. State law controls a debtor's s legal malpractice cause of action and determines whether that claim existed at the time the debtor filed his bankruptcy petition. Under Florida law, a debtor's legal malpractice claim does not exist until an action concluded with an adverse outcome that was proximately caused by his attorney's negligence. Thus, a debtor's legal malpractice claim was not property of his bankruptcy estate where the adverse legal result occurred after the petition date even if some of the attorney's acts occurred prepetition.
U.S. v. Waldron (DBN Subscription Required)	8th Cir.	For bankruptcy crime sentencing purposes, concealment of assets from a bankruptcy estate is a "violation of judicial process" as a matter of law warranting a two-level increase under the sentencing guidelines.