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middle district of tennessee

Walschmidt v. Bank of Am. (In re Wheeler)

Ruling
Trustee could not avoid deed of trust for which release was not recorded prior to petition date.
Procedural posture

Chapter 7 trustee filed an adversary proceeding against a secured creditor, pursuant to 11 U.S.C.S. § 544(a) to exercise his strong arm powers to bring the debtors' residence into the bankruptcy estate under 11 U.S.C.S. § 541. The parties filed cross motions for summary judgment.

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Consumer opinion summary, case decided on October 26, 2012 , LexisNexis #1112-125

In re Citizens Corp.

Ruling
Stay lifted to allow guarantors to prosecute breach of contract claims against bank.
Procedural posture

Movant guarantors filed a motion in the bankruptcy court, seeking relief from the stay that was imposed when a corporation ("debtor") declared chapter 11 bankruptcy so they could pursue counterclaims in state court against a bank that acted as lead bank for the debtor's prepetition lender group and third-party claims against the president of a financial data technology corporation. The chapter 11 trustee opposed the motion.

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Commercial opinion summary, case decided on September 12, 2012 , LexisNexis #1012-043

Eaton v. Ford Motor Credit Co.

Ruling
Debt owed by auto dealer for conversion properly held nondischargeable.
Procedural posture

Creditor filed an adversary proceeding against debtor in the United States Bankruptcy Court for the Middle District of Tennessee, seeking damages and a judgment of nondischargeability of a debt owed under an automobile dealership financing agreement. The bankruptcy court entered judgment in favor of the creditor. The debtor appealed.

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Commercial opinion summary, case decided on August 17, 2012 , LexisNexis #0912-050

In re Gift

Ruling
Debtor's plan not required to provide for payment of state penalty as part of oversecured claim.
Procedural posture

A solvent bankruptcy debtor proposed a plan which provided for payment of interest on local governments' claims for unpaid real property taxes which were over-secured by statutory liens against the property, but did not provide for payment of penalty interest for late payment of the taxes. The governments objected to confirmation of the debtor's plan.

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Consumer opinion summary, case decided on March 22, 2012 , LexisNexis #0412-110

Citizens Corp. v. Tennessee Commerce Bank (In re Citizens Corp.)

Ruling
Chapter 11 trustee appointed due to principal's withdrawal of funds from key subsidiary of debtor.
Procedural posture

Chapter 11 debtor filed an expedited motion for contempt and sanctions for violation of the automatic stay and an expedited motion for a preliminary injunction. Defendant lead lender filed a motion pursuant to 11 U.S.C.S. § 1104(a) for appointment of a chapter 11 trustee.

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Commercial opinion summary, case decided on February 27, 2012 , LexisNexis #0312-097

Waldschmidt v. Johnson (In re Milford)

Ruling
Trustee's partition and sale of property with priority credit for mortgage payments made by debtor approved.
Procedural posture

In this chapter 7 case where the debtor held an interest in real property, the trustee moved for partition and sale of the property pursuant to 11 U.S.C.S. § 363 and sought to provide a priority credit for the debtor's payment of mortgage prior to distributing the net proceeds of the sale to the other parties with interests in the property.

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Consumer opinion summary, case decided on December 09, 2011 , LexisNexis #0112-077

Gregory v. Rho Mobil DEpocha (In re Gregory)

Ruling
Abstention was proper with regard to foreign creditor's case against non-debtor spouse.
Procedural posture

Defendant foreign supplier sought an order per 28 U.S.C.S. § 1334 remanding, to state court, its complaint against a married couple and their company. The husband had removed the case from the state court per 28 U.S.C.S. § 1452 in connection with his chapter 7 case, and the court previously had denied defendant's motion for relief from stay with the result that the case was stayed as to debtor.

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Consumer opinion summary, case decided on October 27, 2011 , LexisNexis #1211-063

In re Baugh

Ruling
Postpetition interest on debtor's special counsel's secured claim for fees disallowed.
Procedural posture

A law firm filed an application pursuant to 11 U.S.C.S. § 330(a) for payment of compensation for legal services and reimbursement of expenses incurred as special counsel to the chapter 11 debtors. The debtors filed an objection to the fee application on the grounds that the interest rate charged exceeded a reasonable rate, the fees charged were not reasonable, and post-petition interest was not a reasonable expense.

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Consumer opinion summary, case decided on October 27, 2011 , LexisNexis #1211-002

Lubber Inc. v. Optari LLC

Ruling
Debtor lacked standing to bring action to rescind separation agreement, which was property of the estate.
Procedural posture

Plaintiff corporation sued defendants, a former licensee and his company, for breach of contract, rescission, unfair competition, trademark infringement, and tort claims. Defendants moved for judgment on the pleadings. The corporation moved for leave to amend.

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Commercial opinion summary, case decided on October 06, 2011 , LexisNexis #1111-021

Piper v. Dollar Gen. Corp.

Ruling
Debtor, but not trustee, was estopped from pursuing unscheduled lawsuit.
Procedural posture

Defendant, a former employer of plaintiff Chapter 13 debtor, filed a motion for summary judgment in the debtor's disability discrimination action, alleging that the debtor was judicially estopped from pursuing her claim against the creditor.

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Consumer opinion summary, case decided on September 29, 2011 , LexisNexis #1011-120