Dewsnup Needs to be Overturned: It’s Out of Touch and Based on a Bizarre Foundation (But U.S. Supreme Court Passes)

By: Donald L. Swanson The U.S. Supreme Court’s Dewsnup v. Timm opinion (502 U.S. 410 (1992)) was wrongly decided and needs to be overturned. Unfortunately, that's not going to happen any time soon, since the U.S. Supreme Court denied certiorari on Tuesday (February 19, 2019) in the case of Ritter v. Brady, Supreme Court Case No. 18-747.... Continue Reading →

Correcting a Defect in Chapter 7: New Effort to Overturn Dewsnup v. Timm

By: Donald L. Swanson You know how bankruptcy debtors can strip-away out-of-money liens in Chapters 11, 12 and 13, using 11 U.S.C. § 506? Well . . . they can’t do it in Chapter 7. That’s because of a screw-up by the U.S. Supreme Court in an early opinion under the Bankruptcy Code—the opinion is Dewsnup... Continue Reading →

Can You Be Held in Contempt for Obeying a Court Order? The U.S. Supreme Court Will Decide (Taggart v. Lorenzen)

By: Donald L. Swanson A Hypothetical: You’ve sued an individual in state court for injunctive and other relief. Your defendant then files bankruptcy and receives a Chapter 7 discharge. Then, you ask the state court to determine that you can proceed with the lawsuit, despite the bankruptcy discharge. The state court says you can, and so... Continue Reading →

A Practical Question That’s Being Ignored at U.S. Supreme Court (Mission Product v. Tempnology)

By: Donald L. Swanson Oral arguments are scheduled for February 20, 2019, before the U.S. Supreme Court in Mission Product Holdings v. Tempnology, LLC (Case No. 17-1657). Legal Question – Effect of Rejection The legal question in Mission Product v. Tempnology is whether the “rejection” of a trademark license agreement—which constitutes a breach of such agreement—terminates... Continue Reading →

Federal Arbitration Act is Superseded by U.S. Constitution’s “Uniform Laws on . . . Bankruptcies” Clause

By: Donald L. Swanson “The Congress shall have Power To . . . establish . . . uniform Laws on the subject of Bankruptcies throughout the United States.” U.S. Constitution, Art. 1, Sec. 8 (emphasis added). Bankruptcy law is special, to begin with. There is no other area of law quite like it -- either legally... Continue Reading →

Public Rights Doctrine — A Useless Tool in Bankruptcy

By Donald L. Swanson The U.S. Supreme Court’s “public rights” doctrine has been around for a long time. Yet, during the entire time of its existence, the Supreme Court, (i) has failed to explain the distinction between public rights and private rights, and (ii) has been inconsistent in applying that distinction. Unfortunately, our bankruptcy world has... Continue Reading →

What Happens When Executory Contracts are Rejected? U.S. Supreme Court to Decide (Mission v. Tempnology)

By: Donald L. Swanson When an executory contract is rejected in bankruptcy, what happens to the rights of the other party under that contract: Are those rights vaporized? Do those rights continue as if nothing happened? or Are those rights affected in some other way? The U.S Supreme Court will tackle this question in the case... Continue Reading →

Two New Justices on U.S. Supreme Court: Here’s Hoping for a Reset on Bankruptcy Court Authority

By: Donald L. Swanson Justices Scalia and Kennedy are gone from the U.S. Supreme Court and replaced by Justices Gorsuch and Kavanaugh.  Hopefully, this change provides a fresh perspective on bankruptcy law and a reset on bankruptcy court authority issues. Justices Scalia and Kennedy A reset is needed because Justices Scalia and Kennedy voted together to... Continue Reading →

Eighth Circuit’s In re Knudsen Opinion is Still Good Law on Chapter 12 Taxes — Despite the U.S. Supreme Court

By: Donald L. Swanson In 1986, Congress enacted Chapter 12 of the Bankruptcy Code to help farmers. Throughout the 1980s, many farmers liquidated their farm assets, either voluntarily or involuntarily, and moved on to other careers. Unfortunately, the liquidation left many of them with nondischargeable tax liabilities beyond anything they could ever repay. Congressional Action on... Continue Reading →

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