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New Cases For the Week of May 31, 2010 - June 4, 2010
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Click here to search prior New Opinion summaries.
| June 4, 2010 |
Case |
Court |
Holding |
In re Grossman's, Inc.
(DBN) |
3rd Cir. |
The Court is persuaded that the widespread criticism of Frenville's accrual test (holding that a claim "arises" for bankruptcy purposes when a "right to payment" accrues under applicable non-bankruptcy law) is justified, as it imposes too narrow an interpretation of a "claim" under the Bankruptcy Code. Accordingly, the Frenville accrual test is overruled. The Court remands to determine whether asbestos claims, based on a pre-petition exposure, but post-petition manifestation of injury, are discharged. |
In Re Matter Of Velocita Worldwide Logistics Inc.
(DBN) |
5th Cir. |
Pre-petition, a debtor settled trade secret litigation against the debtor and several of the debtor's employees through a settlement agreement which made the debtor the the subject employees jointly and severally liable for payment of a $1.85 million settlement amount. The debtor paid the settlement and subsequently filed bankruptcy. The debtor's trustee sued the co-liable employees, asserting that they owed the debtor an implied obligation of contribution to repay the debtor for their "share" of the settlement amount. The Court finds that under applicable law (Texas) the implied right of contribution among jointly and severally liable parties is generally limited to sureties and guarantors and does not apply in this situation. |
In Re Gordon Properties, LLC
(DBN) |
Bankr. ED VA |
A condominium board violated the automatic stay when it refused to allow a condominium owner/debtor to vote at an owners' meeting due to the debtor's delinquency in paying assessments. The refusal to allow the debtor to vote was an act to collect the past-due assessments. |
In re Moore
(DBN) |
5th Cir. |
A trustee may sell litigation
claims that belong to the estate, as it can other estate property, pursuant
to § 363(b). It was an abuse of discretion for a bankruptcy ocurt to decline to authorize the sale of avoidance actions to a creditor who was offering the highest price for the claims. |
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| June 3, 2010 |
Case |
Court |
Holding |
In re Exide Technologies
(DBN) |
3rd Cir. |
In a Chapter 11 bankruptcy case, district court's affirmance of the Bankruptcy Court's grant of debtor's motion to reject an agreement to sell substantially all of its industrial battery business on the ground that the agreement was an executory contract, subject to rejection under 11 U.S.C. section 365(a), and that rejection terminated the debtor's obligations under it, is vacated and remanded as: 1) the agreement is not an executory contract because it does not contain at least one ongoing material obligation for the other party; and 2) because the agreement is not an executory contract, the debtor cannot reject it. |
Moses v. Howard Univ. Hospital
(DBN) |
DC Cir. Crt. App. |
In an action against a hospital claiming retaliation in violation of Title VII of the Civil Rights Act, summary judgment for defendant is affirmed where, even after he had filed for bankruptcy, plaintiff continued to hold himself out before the district court as a valid plaintiff, a position "clearly inconsistent" with his pursuit of relief in bankruptcy. |
Official Committee Of Unsecured Creditors Of Allegheny Health, Education And Research Foundation v. PriceWaterhouseCoopers, LLP
(DBN) |
3rd Cir. |
In a now bankrupt nonprofit company's committee's action against a financial auditing company for breach of contract, professional negligence, and aiding and abetting a breach of fiduciary duty, district court's grant of the defendant's motion for summary judgment is remanded as Pennsylvania law requires an inquiry into whether the third party dealt with the principal in good faith. |
SIPC v. Lehman Bros.
(DBN) |
Bankr. SD NY |
The filing date of the Lehman
liquidation is the only correct date for determining claims based on a customer's short positions. That date is an immutable element of every case under SIPA. Nothing in the safe harbor provisions of the Bankruptcy Code is
inconsistent with that central liquidation premise. |
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| May 31, 2010 |
Case |
Court |
Holding |
In re Big Springs Realty, LLC
(DBN) |
Bankr. D. Mont. |
Even if a defendant in an adversary proceeding has not filed a proof of claim in the main bankruptcy case, the defendant's assertion of the affirmative defense of setoff necessarily implicates the claims allowance process, thereby submitting the defendant to the equitable jurisdiction of the bankruptcy court and waiving the defendant's right to jury trial. |
In re Ran
(DBN) |
5th Cir. |
In an Israeli bankruptcy receiver's appeal of the district court's denial of his petition for recognition under Chapter 15 of the Bankruptcy Code of an ongoing, involuntary bankruptcy proceeding pending in Israel, the order is affirmed where: 1) it was evident that, when the receiver filed the petition for recognition, the debtor's habitual residence was in Houston, Texas; 2) while sufficient to rebut the presumption that debtor's center of main interest was in the U.S., the receiver's evidence was nevertheless insufficient to prove by a preponderance of the evidence that Israel was the location of debtors center of main interests; and 3) at the time the receiver filed his petition for recognition, debtor possessed neither a secondary residence nor place of employment in Israel. |
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