Southern District

Bryant v. HSBC Mortg. Servs. (In re Bryant)

Plaintiff bankruptcy debtor brought an adversary proceeding against defendant mortgage creditor alleging that the creditor did not hold a valid mortgage against the debtor's real property and overstated the amount owed on the debtor's mortgage debt. The creditor moved for relief from the automatic bankruptcy stay to allow foreclosure against the property.
Ruling: 
Relief from stay to foreclose granted where creditor established ownership of mortgage and debtor was in arrears and lacked equity in the property.
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Consumer case opionion summary, case decided on July 11,2011, LexisNexis #0811-107

Walton v. HLJ Enters. (In re HLJ Enters.)

Objectors, the U.S. Trustee (UST) and a creditor, challenged the right of an accounting firm to compensation based on its second application for compensation and also sought an order requiring the firm to disgorge fees previously paid to it. At issue was whether the firm was ineligible to serve as an accountant for debtor in possession (DIP) by reason of 11 U.S.C.S. § 327(a).
Ruling: 
Accounting firm's application for compensation denied as it was ineligible to provide services to debtor in possession.
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Commercial case opionion summary, case decided on June 28,2011, LexisNexis #0911-036

In re Trenton Ridge Investors LLC

Claimant bank, a secured creditor, opposed motions by chapter 11 debtors, two limited liability companies, seeking nonconsensual confirmation of proposed chapter 11 plans relating to two apartment complexes on claims that the plans, both of which were "cramdowns," complied with all relevant provisions in 11 U.S.C.S. § 1122, 11 U.S.C.S. § 1123, and 11 U.S.C.S. § 1129. One issue was whether the plans were proposed in good faith and were feasible.
Ruling: 
Confirmation denied where plans including cramdowns lacked feasibility.
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Commercial case opionion summary, case decided on June 23,2011, LexisNexis #1011-130

Wilmington Plantation Owners Assn v. Foster (In re Foster)

A homeowners' association and individual homeowners filed a motion to dismiss a debtor's case for cause pursuant to 11 U.S.C.S. § 1112(b)(1) on the grounds that the petition was not filed in good faith. The debtor, an unsecured creditor, and two secured creditors opposed the motion.
Ruling: 
Case filed to gain tactical advantage in litigation dismissed as not filed in good faith.
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Consumer case opionion summary, case decided on June 17,2011, LexisNexis #0911-061

In re Summer

The United States Trustee (UST) filed a motion to dismiss the Chapter 7 debtors' case for abuse pursuant to 11 U.S.C.S. § 707(b).
Ruling: 
Dismissal for abuse denied where totality of circumstances showed inability to repay debt.
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Consumer case opionion summary, case decided on June 10,2011, LexisNexis #0811-058

Coleman v. American Concrete Inc. (In re Sportsmans Link Inc.)

Plaintiff, the Chapter 7 trustee, sought recovery of various pre-petition transfers made by the debtor to defendant transferees, alleging that they were either preferential or fraudulent under 11 U.S.C.S. §§ 547 and 548. The threshold issue was whether the debtor was insolvent at the time of the transfers, or became insolvent as a result of any of the transfers.
Ruling: 
Transfers could not be avoided where balance sheet and schedules showed debtor was solvent on petition date.
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Commercial case opionion summary, case decided on May 24,2011, LexisNexis #0811-056

In re Graham Bros. Constr. Inc.

A claimant of Chapter 11 debtor filed a motion to allow a late claim.
Ruling: 
Late filed proof of claim disallowed where creditor intentionally had sought to avoid jurisdiction of bankruptcy court.
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Commercial case opionion summary, case decided on May 16,2011, LexisNexis #0811-135

Community West Bank v. HSD Partners LLC (In re HSD Partners LLC)

In debtor's chapter 11 case, creditor filed a motion for relief from the automatic stay under 11 U.S.C.S. § 362, and after preliminary hearings were conducted, a trial of all issues was held.
Ruling: 
Creditor not entitled to relief from stay to proceed against property that was necessary to debtor's reorganization.
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Commercial case opionion summary, case decided on April 01,2011, LexisNexis #0611-005

AgSouth Farm Credit v. Del-A-Rae Inc. (In re Del-A-Rae Inc.)

A creditor holding a lien on certain real estate belonging to a chapter 11 debtor, sought relief from stay per 11 U.S.C.S. § 362 as to that property on claims that debtor lacked any equity therein and that it was not necessary to an effective reorganization. Debtor challenged the valuation assigned by movant and sought to retain the property.
Ruling: 
Relief from stay granted where debtor lacked equity in property despite potential cushion in event of market rebound.
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Commercial case opionion summary, case decided on March 29,2011, LexisNexis #0611-006

Adams v. Volpitto (In re Volpitto)

Former employees brought an adversary proceeding against bankruptcy debtor seeking a determination that a debt to the employees for the debtor's failure to make employer contributions to a retirement plan was nondischargeable under 11 U.S.C.S. § 523(a)(4) based on the debtor's breach of fiduciary duty as the plan trustee.
Ruling: 
Debtor employer's failure to make discretionary contributions to profit sharing plan did not result in nondischargeable debt.
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Consumer case opionion summary, case decided on March 22,2011, LexisNexis #0711-015

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