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District of minnesota

Milavetz Gallop & Milavetz PA v. United States

Ruling
BAPCPA provision violates First Amendment rights by barring truthful as well as false and deceptive advertising.
Procedural posture

Plaintiffs, practicing bankruptcy attorneys, sought an order declaring portions of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 ("BAPCPA") that restricted and compelled speech on the part of debt relief agencies unconstitutional as violative of the First Amendment, at least as applied to attorneys. Defendant United States moved to dismiss the claim for failure to state a claim upon which relief can be granted.

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opinion summary, case decided on December 07, 2006 , LexisNexis #0107-005

In re Toberman

Ruling
IRS was entitled to a priority unsecured claim for debtor's failure to remit withholding taxes.
Procedural posture

When debtor filed a chapter 7 bankruptcy proceeding, the IRS filed a proof of claim in which it asserted that, by reason of unpaid employee withholding taxes, it was a priority unsecured creditor under 11 U.S.C. § 507(a)(8) and was entitled to a stated sum in that capacity. The trustee objected to the IRS claim and also claimed that it was properly subordinated per 11 U.S.C. § 510(c).

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opinion summary, case decided on November 22, 2006 , LexisNexis #0307-022

Mesaba Aviation Inc. v. Aircraft Mech. Fraternal Assn (In re Mesaba Aviation Inc.)

Ruling
Injunction issued to prevent strike against debtor airline by unions after rejection of collecitve bargaining agreement.
Procedural posture

Chapter 11 debtor in possession filed a motion under Fed. R. Civ. P. 65(a), as incorporated by Fed. R. Bankr. P. 7065, for a preliminary injunction, seeking an injunction against its unions' exercise of self-help, i.e., striking, in the wake of debtor's court-authorized rejection of its collective bargaining agreements pursuant to 11 U.S.C. § 1113 and debtor's subsequent imposition of modified terms of employment.

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opinion summary, case decided on October 23, 2006 , LexisNexis #1106-067

In re Harwick

Ruling
Debtor entitled to claim standard amount for vehicle owner expense.
Procedural posture

The United States Trustee ("UST") moved to dismiss the debtor's chapter 7 case pursuant to 11 U.S.C. § 707(b) on the grounds that the filing constituted a substantial abuse of the provisions of chapter 7.

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opinion summary, case decided on October 13, 2006 , LexisNexis #1106-042

Velde v. Kirsch (In re Miller)

Ruling
Subsequent new value defense to avoidance not available where preferential payment was made to cure a bounced check.
Procedural posture

An involuntary chapter 7 petition was filed against debtor. Debtor converted the case to chapter 11. The case was later converted to chapter 7. The trustee commenced an adversary proceeding seeking to avoid a payment from debtor to a soybean seller of $44,955 as a preferential transfer. Pending was the trustee's motion for partial summary judgment. The complaint also sought to avoid a separate transfer, but it was not included in the motion.

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opinion summary, case decided on August 29, 2006 , LexisNexis #0107-097

In re Espey

Ruling
Refunds received under IRS Earned Income Credit and state tax law were not "local" public assistance benefits and were not exempt.
Procedural posture

A chapter 7 trustee objected to a debtor's claimed exemption under 11 U.S.C. § 522(d)(10)(A) of state and federal tax refunds under the Internal Revenue Service Earned Income Credit ("EIC") and Minnesota Department of Revenue Working Family Credit ("WFC") public assistance programs.

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opinion summary, case decided on August 08, 2006 , LexisNexis #0906-020

OneBeacon Amer. Ins. Co. v. A.P.I. Inc.

Ruling
Plan containing trust succeeding to debtor's rights in asbestos insurance policies confirmed.
Procedural posture

Appellant insurer challenged an order of the bankruptcy court, which confirmed a plan of reorganization of appellee debtor, a distributor of insulation that contained asbestos.

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opinion summary, case decided on May 25, 2006 , LexisNexis #0906-044

In re Hyman Freightways Inc.

Ruling
Court denied trustee's motion seeking refund of professional fees since payments were authorized by Bankruptcy Code and approved by court.
Procedural posture

The chapter 7 trustee, purportedly under 11 U.S.C. § 726(a), filed a motion seeking a refund of professional fees from three groups of professionals who provided services to the debtor during the time the debtor was in chapter 11.

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opinion summary, case decided on May 18, 2006 , LexisNexis #0606-131

In re Mesaba Aviation Inc.

Ruling
Debtor was denied motion to reject collective bargaining agreements despite compliance with most of section 1113 requirements since debtor had not provided union with software model for making its projections.
Procedural posture

A bankruptcy debtor, a regional airline whose only customer was a network carrier which was also in bankruptcy, proposed to modify collective bargaining agreements with unions representing the debtor's employees to reduce the debtor's labor costs in reorganization. After the unions rejected the debtor's proposal, the debtor moved for authority to reject the collective bargaining agreements pursuant to 11 U.S.C. § 1113.

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opinion summary, case decided on May 18, 2006 , LexisNexis #0706-066

In re Kurtzahn

Ruling
Debtor was denied an extension of an automatic stay since the debtor could not prove the second filing's plan was feasible and the filing was not made in bad faith.
Procedural posture

The debtor filed a motion under 11 U.S.C. § 362(c)(3)(B) — one of the provisions added to the Bankruptcy Code by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, Pub. L. No. 109-8 — to extend the automatic stay beyond the 30-day limit.

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opinion summary, case decided on January 31, 2006 , LexisNexis #0306-009