In re Ridings

(Bankr. E.D. Ky. Dec. 22, 2015)

The court denies the Chapter 13 debtors’ motion to modify the confirmed plan to reduce the secured claim of the IRS. The debtors argued that the collateral was not worth the amount of the claim, but the Court holds that reducing an allowed secured claim is not a modification permitted by the code. Opinion below.

2015-12-22 – in re ridings

Author: Matt Lindblom

National Labor Relations Board v. Calvert (In re Calvert)

(Bankr. S.D. Ind. Dec. 21, 2015)

The court enters judgment in this adversary proceeding commenced by the NLRB against the debtor, seeking to except from discharge the debt owed to the NLRB. The claim was based on alleged violations of the National Labor Relations Act, when the debtor took steps to avoid his company’s employees from unionizing. The court finds that the NLRB failed to prove the requisite intent under 11 U.S.C. § 523(a)(6) and the information omitted from the schedules and in the bankruptcy (e.g., lost promissory notes) did not rise to the level of a denial of discharge under § 727. Opinion below.

2015-12-21 – nlrb v calvert

Author: Matt Lindblom

Indiana Department of Workforce Development v. Burge (In re Burge)

(Bankr. S.D. Ind. Dec. 16, 2015)

The bankruptcy court finds that the Indiana Department of Workforce Development’s claim for overpayment of benefits to the debtor while he was actually employed is dischargeable, but the statutory penalties for the overpayment are not dischargeable. The debtor’s agent defrauded the department without the debtor’s knowledge. Because the debtor was unaware of the fraud, the debt was not excepted from discharge under 11 U.S.C. § 523(a)(2)(A). However, the statutory penalties imposed against the debtor for the fraud were nondischargeable under § 523(a)(7). Opinion below.

2015-12-16 – in dept of workforce dev v burge

Author: Matt Lindblom

In re Martin

(6th Cir. B.A.P. Dec. 16, 2015)

The Sixth Circuit B.A.P. affirms the decision of the bankruptcy court granting relief from the automatic stay so that the creditor can continue with state court litigation against the debtor. The court discusses the factors considered in deciding whether to lift the stay for prepetition litigation, but ultimately affirms the bankruptcy court. The state court litigation was further along than the bankruptcy, additional parties not involved in the bankruptcy were involved in the state court litigation, and the creditor had included a jury demand in state court. Opinion below.

2015-12-16 – in re martin

Author: Matt Lindblom

Rosco v. Lockhart

(N.D. Ind. Dec. 16, 2015)

The district court affirms the bankruptcy court’s decision finding that the creditor’s assertion of a counterclaim for unpaid rent in the state court action filed by the debtor for return of a security deposit after discharge was not a violation of the stay or the discharge injunction. Opinion below.

2015-12-16 – rosco v lockhart

Author: Matt Lindblom

In re Biery

(Bankr. E.D. Ky. Dec. 11, 2015)

The bankruptcy court concludes that class treatment is inappropriate for certain claims but is appropriate for debtors receiving regular billing statements from the mortgage servicer after discharge. The debtors are appointed as class representatives. Opinion below.

2015-12-11 – in re biery

Author: Matt Lindblom

Holloway v. Veterans Administration (In re Holloway)

(Bankr. W.D. Ky. Dec. 3, 2015)

The bankruptcy court grants the defendant’s motion for judgment in this preference action. The debtor received overpayments for disability benefits from the defendant in the years leading up to the bankruptcy. Within the preference period, the defendant had recouped some of the overpayment from the debtor’s active duty military pay. The court holds that the defendant was entitled to recoup the funds under the doctrine of recoupment, because the source of the defendant’s claims was a contract, and the debtor’s claims arose from the same contract. Opinion below.

2015-12-03 – holloway v veterans administration

Author: Matt Lindblom