New Cases For the Week of June 25, 2007 - June 29, 2007
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June 28, 2007 |
Case |
Court |
Holding |
In re Macke International Trade, Inc.
(DBN Subscription Required) |
9th Cir. BAP |
A bankruptcy court may, under appropriate circumstances, order a
petitioning creditor to pay an alleged debtor’s attorney’s fees
and costs when, upon finding that the interests of creditors and
debtor would be better served, it dismisses a good faith involuntary
petition pursuant to § 305(a). |
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June 27, 2007 |
Case |
Court |
Holding |
In re Count Liberty LLC
(DBN Subscription Required) |
Bankr. C.D. Cal. |
An attorney for a debtor
in possession is a fiduciary of the bankruptcy estate. While counsel’s duty to the estate may not rise to the level of a policeman for the debtor’s post-petition conduct,57 an attorney for the debtor in possession has fiduciary
obligations to the estate stemming from his fiduciary duties to the debtor in possession
and his responsibilities as an officer of the court. A debtor in possession’s attorney bears a
heightened duty of care to ensure the integrity of the bankruptcy process. A debtor in possession’s attorney must be proactive, i.e., prepared to render
unsolicited legal advice regarding preventative or corrective action that may be
necessary for the debtor in possession to properly discharge its fiduciary obligations.
Counsel for the DIP is liable for sanctions for failing to act diligently to ensure that the DIP ’s principal took
appropriate steps to safeguard funds that were supposed to be segregated from a free and clear sale. |
Zurich Am. Ins. Co. v. Tessler
(DBN Subscription Required) |
4th Cir. |
A wrongful death claimant who had not yet filed suit, but whose identity and potential claim were either actually known or reasonably ascertainable to the debtor, was a "known creditor" of the debtor, and thus entitled to specific notice of the bankruptcy proceeding and applicable filing dates. |
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June 25, 2007 |
Case |
Court |
Holding |
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