How the Bankruptcy Stay Passed Constitutional Muster — A Depression-Era Opinion that’s a Model for Today

By: Donald L Swanson The automatic stay is one of the basics of our bankruptcy laws. It’s a foundational rule for the entire bankruptcy system. But that hasn’t always been the case. In fact, the U.S. Supreme Court, in a Depression-era case, had to decide whether a bankruptcy stay is constitutionally permissible. And, fortunately, the Supreme... Continue Reading →

Who Gets the $4 Million Tax Refund in Bankruptcy: U.S. Supreme Court to Decide (Rodriguez v. FDIC)

By: Donald L. Swanson On June 28, 2019, the U.S. Supreme Court granted certiorari in the case of Rodriguez v. FDIC, (Supreme Court Case No. 18-1269). The case is about a $4 million tax refund received by a parent corporation in bankruptcy, based upon losses from one of its wholly owned subsidiaries.  The question is this:... Continue Reading →

The Bankruptcy Code Needs an Advocate for Its Interests at U.S. Supreme Court — The Solicitor General is Not Adequate

By: Donald L Swanson The Bankruptcy Code is in a precarious position.  It is a “transformative piece of legislation,” but it is without a strong agency in the Executive Branch to interpret it, enforce it, and promote its interests. [Fn. 1] Each Federal agency is part of the Executive Branch and has an area of responsibility... Continue Reading →

Legal Standard for Imposing Civil Contempt

By: Donald L. Swanson On June 3, 2019, the U.S. Supreme Court issued its opinion in the Taggart v. Lorenzen case. The Question The question before the Supreme Court, in Taggart v. Lorenzen, “concerns the legal standard for holding a creditor in civil contempt when the creditor attempts to collect a debt in violation of a... Continue Reading →

Finality of Bankruptcy Court Orders for Appeal: U.S. Supreme Court Will Weigh In (Ritzen v. Jackson)

By: Donald L. Swanson “Appellate deadlines cannot serve their purpose when their trigger is unclear.” --U.S. Sixth Circuit Court of Appeals in Ritzen v. Jackson. This should be interesting. On May 20, 2019, the U.S. Supreme Court granted certiorari to decide whether the denial of a motion for relief from automatic bankruptcy stay is appealable as a... Continue Reading →

Rejected Executory Contracts Made Simple: Mission v. Tempnology

By: Donald L. Swanson “Rejection of a contract—any contract—in bankruptcy operates not as a rescission but as a breach.” Essential declaration of law from U.S. Supreme Court opinion on trademark issues in Mission Product Holdings, Inc. v. Tempnology, LLC, (Case No. 17-1657), issued May 20, 2019. Photocopier Lease Illustration The Supreme Court’s opinion illustrates and clarifies how... Continue Reading →

Are Stern & Granfinanciera Going The Way Of Dewsnup: Being Limited To Their Narrow Holdings?

By: Donald L. Swanson “Movants are asking this Court to extend the holdings of [Stern v. Marshall and Granfinanciera] in order to find that 28 U.S.C. § 157(a) is unconstitutional . . . The Court declines to make that leap.” Chief Judge Christopher S. Sontchi, Delaware Bankruptcy Court, in Paragon v. Noble Corporation, A.P. No. 17-51882,... Continue Reading →

Can Obeying a Court Order Prevent Contempt Sanctions? (Taggart v. Lorenzen)

Note:  This article was published, originally, by the American Bar Association, in its "Preview of United States Supreme Court Cases," Issue No. 7, Vol 46, page 50, on April 15, 2019.  By: Donald L. Swanson CASE AT A GLANCE Let’s say you sue a defendant in state court for injunctive relief. The defendant then files bankruptcy and receives... Continue Reading →

Getting Away With Corporate Raiding: A New In re Tribune Opinion and § 546(e) Safe Harbor

By: Donald L. Swanson The Tribune Company (yes, the formerly-venerable Chicago Tribune newspaper) filed bankruptcy in 2008, after being crippled by a corporate raid in 2007 Here’s What Happened Tribune’s dominant shareholders (they owned 33%) wanted to cash out their shares of stock. So they engineered a scheme, whereby Tribune borrowed money to buy its own... Continue Reading →

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