§ 553

In re Goodman

Pursuant to 11 U.S.C.S. § 553(b), debtor filed a motion for turnover of Social Security Insurance (SSI) benefits in the amount of $7,414.
Ruling: 
Retroactive Social Security Income benefits intercepted by the Social Security Administration and applied to overpayment could be recovered for the estate.
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Consumer case opionion summary, case decided on February 17,2012, LexisNexis #0312-054

In re Lehman Bros. Inc.

Debtor declared chapter 11 bankruptcy, and a federal district court issued a liquidation order and approved the appointment of a trustee under the Securities Investor Protection Act of 1970, 15 U.S.C.S. § 78aaa et seq. The trustee sought an order requiring a bank to turn over collateral it held that belonged to the debtor, and the bank filed a cross-motion for an order enforcing an agreement it entered with the debtor.
Ruling: 
Bank ordered to turn over collateral held under terminated swap agreement, which could not be used to satisfy debts owed to affiliate.
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Commercial case opionion summary, case decided on October 04,2011, LexisNexis #1011-124

Regal Fin. Bank v. Heaton (In re Heaton)

Defendant Chapter 11 debtors were prevailing parties in plaintiff creditor's complaint seeking to render nondischargeable a debt evidenced by two pre-bankruptcy commercial guaranties in the creditors' favor. The debtors moved for an award of attorney's fees against the creditor pursuant to an attorney's fees clause in the commercial guaranties.
Ruling: 
Creditor could not set off postpetition assessment of debtor's attorneys' fees against its prepetition claim against debtor.
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Consumer case opionion summary, case decided on May 23,2011, LexisNexis #0611-129

Ogle v. United States Dept of Agric. (In re Ogle)

The matters before the court for decision were plaintiff debtors' First Amended Complaint (FAC) in this adversary proceeding and defendant U.S. Department of Agriculture's Rural Housing Service's (RHS) Motion for Relief from Stay and Setoff in attendant "Bankr. No. 10-50113."
Ruling: 
Postpetition setoff could not be recovered.
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Consumer case opionion summary, case decided on February 14,2011, LexisNexis #0311-130

Bank of America v. Lehman Bros. Holdings Inc. (In re Lehman Bros. Holdings Inc.)

Plaintiff clearing bank brought an adversary proceeding against defendant bankruptcy debtor, a large securities broker, seeking a declaration that the bank properly set off funds in a security account for overdrafts against unrelated debts of the debtor, or that retroactive relief from the automatic bankruptcy stay was warranted. The bank and the debtor cross-moved for summary judgment.
Ruling: 
Setoff by bank of funds in debtor's overdraft security account against unrelated debts violated stay.
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Commercial case opionion summary, case decided on November 16,2010, LexisNexis #1210-054

In re Telligenix Corp.

Debtor filed a chapter 11 bankruptcy case. The debtor moved to treat a lessor's administrative claim as a pre-petition claim for purposes of set-off under 11 U.S.C.S. § 553.
Ruling: 
Lessor's administrative expense claim for postpetition rent was not subject to setoff.
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Commercial case opionion summary, case decided on September 23,2010, LexisNexis #1010-096

In re Lehman Bros. Holdings Inc.

Movant debtors sought an order enforcing the automatic stay and compelling the payment of certain funds held by respondent creditor in a general deposit account. The debtors asserted that the creditor could not exercise a setoff under 11 U.S.C.S. § 553 or the exceptions under 11 U.S.C.S. §§ 560(a) and 561(a), and that its freeze of the debtors' funds violated the automatic stay under 11 U.S.C.S. § 362.
Ruling: 
Creditor ordered to turn over funds held pursuant to master credit swap agreement.
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Commercial case opionion summary, case decided on May 05,2010, LexisNexis #0710-056

In re England Motor Co.

Bankruptcy debtors were a parent corporation and two subsidiaries, the parent obtained loans from a bank but did not have an account at the bank, and the subsidiaries had deposit accounts at the bank. The bank moved for relief from the automatic bankruptcy stay to allow the bank to set off amounts deposited in the subsidiaries' accounts against the parent's loan debt to the bank under 11 U.S.C.S. § 553.
Ruling: 
Relief from stay granted to the extent creditor bank could set off debtor subsidiary's account against debtor parent's debt.
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Commercial case opionion summary, case decided on January 19,2010, LexisNexis #0310-050

In re Flying J Inc.

Debtor filed a petition under chapter 13 of the Bankruptcy Code and a plan for repaying his creditors. A bank filed an objection to the debtor's plan because it proposed to pay a mortgage on a house he inherited from his mother under his plan, and also filed a motion for relief from the automatic stay.
Ruling: 
Net operating loss earned postpetition, carried back and applied against prepetition income, was a prepetition claim that could be set off against prepetition taxes owed.
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Commercial case opionion summary, case decided on December 28,2009, LexisNexis #0210-121

In re C.W. Mining Co.

Creditors filed a petition against a mining company (debtor), seeking an order requiring the debtor to enter bankruptcy. The bankruptcy court entered an order for relief, converted the case to one under chapter 7 of the Bankruptcy Code, and appointed a trustee. The trustee filed adversary proceedings against two companies (lessors) that leased property to the debtor and a company (transferee) that acquired rights to mine coal on the properties.
Ruling: 
Trustee could offset amounts paid to Minerals Management Services on behalf of debtor's former lessors against lessor's claim against the estate.
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Commercial case opionion summary, case decided on December 09,2009, LexisNexis #0110-058

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