Mediation Order in Purdue Pharma Bankruptcy: Managing A Tension

Managing tension (photo by Marilyn Swanson) By: Donald L Swanson On January 3, 2022, Reuters reports, under the heading “Judge orders mediation for Purdue, Sacklers over opioid settlement,” as follows: A U.S. bankruptcy judge orders mediation in the Purdue Pharma bankruptcy [fn. 1], calling for the company, the Sackler family members that own it and nine... Continue Reading →

Deposing A Mediator About What Happened In The Mediation (Roberts v. City of Fairbanks)

Pursuing a strategy? (Photo by Marilyn Swanson) By: Donald L Swanson “There is no federal mediation privilege”;“the mediator's testimony about the mediation is not privileged”; and“there is no legal bar to Defendants seeking the [mediator’s testimony] with regard to the mediation and settlement negotiations.” --Roberts v. City of Fairbanks, Case No. 17-cv-00034, U.S. District Court of... Continue Reading →

U.S. Supreme Court: Flip-Flopping On Constitution’s Bankruptcy Clause

Flip-Flopping (photo by Marilyn Swanson) By: Donald L Swanson “The Congress shall have Power . . . To establish . . . uniform Laws on the subject of Bankruptcies throughout the United States” (U.S. Const., Article I, §8, cl. 4). Once upon a long time ago, the U.S. Constitution’s Bankruptcy Clause, and its “uniform Laws” requirement,... Continue Reading →

Merchant Cash Advances Are Loans, Not Sales, And Violate Usury Laws (In re Shoot the Moon)

A death knell? (photo by Marilyn Swanson) By: Donald L Swanson Merchant cash advances are the business version of payday loans: a relatively small amount of money loaned at a high rate of interest. Payday loans are repaid from debtor’s next paycheck, while merchant cash advances are repaid by daily withdrawals from debtor’s bank account. Merchant... Continue Reading →

Constitutionality of U.S. Trustee v. Administrator Programs (Siegel v. Fitzgerald)

Uniformity (photo by Marilyn Swanson) By: Donald L Swanson The United States of America is asking the U.S. Supreme Court to rule on the constitutionality of having U.S. Trustees in 88 judicial districts and Bankruptcy Administrators in 6 judicial districts. What follows is a summary of the U.S. Trustee’s explanation of the constitutionality issue in a... Continue Reading →

How To “Fix” A Subchapter V Plan’s Term (In re Urgent Care)

11 U.S.C. Sec. 1191(c)(2) By: Donald L Swanson “The three-year term here is fair and equitable, as it properly balances the risks and rewards for both the debtor and its creditors”; and“the Court declines to fix a longer plan period.” --From a Bankruptcy Court opinion confirming Debtor’s Subchapter V plan—In re Urgent Care Physicians, Ltd, Case... Continue Reading →

Allowing Subchapter V Trustee Fees In A Dismissed Case As “Reasonable” and “Necessary” (In re Besthost)

A reasonable and necessary path (photo by Marilyn Swanson) By: Donald L Swanson A Subchapter V Trustee is entitled to allowance of fees, even when the Subchapter V case is dismissed for lack of authority to file the case. That's the December 16, 2021, ruling in In re Besthost Inn LLC, Case No 21-12158 in the... Continue Reading →

Arbitration Clause As Executory Contract: Rejecting In Bankruptcy To Forestall Arbitration? (Highland Capital v. Dondero)

An outlier (photo by Marilyn Swanson) By: Donald L Swanson Bankruptcy Court denies a motion to compel arbitration, because the arbitration agreement is a rejected executory contract. This appears to be a new and outlying theory for denying arbitration of bankruptcy disputes. The opinion is Highland Capital Management, L.P. v. Dondero et al., A.P. No. 21-03003,... Continue Reading →

“Single Asset Real Estate” & Subchapter V Eligibility (In re Moore; In re McGrath; In re ENKOGS1)

A “single asset real estate”? (Photo by Marilyn Swanson) By: Donald L Swanson Rules for Subchapter V eligibility exclude a “single asset real estate” business.  The operative statute provides: “Debtor’ . . . [in Subchapter V] means a person engaged in commercial or business activities . . . excluding a person whose primary activity is the... Continue Reading →

Mediation Privilege For A Proposed (But Not Actual) Mediator? (In re Boy Scouts)

Not real (photo by Marilyn Swanson) By: Donald L Swanson An insurer in the Boy Scouts of America bankruptcy [fn. 1] files a motion to compel production of documents held by a proposed mediator who did not become an actual mediator in the case. The proposed mediator opposes production based upon a mediation privilege. Guess how... Continue Reading →

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