Marshall v. Blake

(7th Cir. Mar 22, 2018)

The Seventh Circuit affirms the bankruptcy court after determining it has jurisdiction to hear the direct appeal from the bankruptcy court pursuant to Bankruptcy Rule 8008. The court holds that the bankruptcy court correctly overruled the trustee’s objection to confirmation of the Chapter 13 plan. The plan appropriately applied the debtor’s tax credit and refund to the debtor’s disposable income calculation by converting it to an increase to monthly income. The trustee argued that the refund should be applied to additional plan payments and that it was inappropriate to apply it to the debtor’s monthly income. Opinion below.

Judge: Flaum

Attorney for Trustee: Lauren L. Tobiason

Attorneys for Debtor: James A. Brady, Jamie F. Reisman

2018-03-22 – in re blake

Author: Matt Lindblom

Reinbold v. Thorpe (In re Thorpe)

(7th Cir. Jan. 31, 2018)

The Seventh Circuit affirms the bankruptcy court, holding that the bankruptcy estate took the debtor’s half interest in the real property subject to the debtor’s ex-spouse’s contingent interest in the property. The court applies the Illinois Marriage and Dissolution of Marriage Act and concludes that the divorce court divested the estate of all rights to the marital home when it awarded the property to the debtor’s ex-spouse pre-petition. Opinion below.

Judge: Sykes

Attorneys for the Trustee: Jeana K. Reinbold; Pollick & Schmahl, LLC, Michael Mario Schmahl, John Franklin Pollick

Attorney for Appellee: Katz, Huntoon & Fieweger, Dale G. Haake

2018-01-31 – in re thorpe

Author: Matt Lindblom

 

Levin v. Verizon Business Global, LLC (In re OneStar Long Distance, Inc.)

(7th Cir. Sep. 22, 2017)

The Seventh Circuit affirms the bankruptcy court, holding that the defendant’s new value defense to the trustee’s preference claim was valid. The trustee argued that the defendant was compensated for the new value when the debtor transferred to an affiliate prepetition its contract and debt owed to the defendant. The court finds such transfer merely acted as an assignment of the debt and did not discharge the debt. Thus, the new value defense was applicable. Opinion below.

Judge: Sykes

Attorneys for Trustee: Kilpatrick Townsend & Stockton LLP, Colin Bernardino, Todd C. Meyers, Michael D. Langford

Attorneys for Defendant: Stinson Leonard Street LLP, Mark S. Carder; Bingham Greenbaum Doll, LLP, Thomas C. Scherer

2017-09-22 – in re onestar long distance 1

Author: Matt Lindblom

Sunshine Heifers, LLC v. Citizens First Bank (In re Purdy)

(6th Cir. Aug. 31, 2017)

The Sixth Circuit affirms the bankruptcy court’s decision finding the bank had a superior interest in the proceeds of an auction of the debtor’s cattle. The appellant contended its interest as lessor was superior and that the Sixth Circuit had already determined it was entitled to the proceeds. The bankruptcy did not err in determining ownership of the cattle at the time of the auction after the prior remand. Opinion below.

Judge: Moore

Attorneys for Appellant: Keller & Almassian, Michael D. Almassian, Nicholas S. Laue

Attorneys for Bank: Kerrick Bachert PSC, Scott A. Bachert, Ashley D. Gerughty

2017-08-31 – in re purdy

Author: Matt Lindblom

Grede v. FCStone, LLC (In re Sentinel Management Group, Inc.)

(7th Cir. Aug. 14, 2017)

The Seventh Circuit reverses the district court and holds that certain funds held by the debtor were held in trust for the appellant and other creditors in the same customer class. The funds therefore were not property of the estate that should be distributed pro rata to all creditors. Opinion below.

Judge: Hamilton

Attorneys for Appellant: Foley & Lardner LLP, Stephen Bedell, Robert Seth Bressler, Geoffrey S. Goodman, David B. Goroff, Thomas P. Krebs, William J. McKenna, Jr.

Attorneys for Appellee: Jenner & Block LLP, Vincent E. Lazar, Catherine L. Steele, Angela M. Allen, Barry Levenstam

2017-08-14 – in re fcstone

Author: Matt Lindblom

Secure Leverage Group, Inc. v. Bodenstein (In re Peregrine Financial Group, Inc.)

(7th Cir. Aug. 8, 2017)

The Seventh Circuit adopts the district court’s opinion, affirming the bankruptcy court’s ruling in favor of the trustee. The trustee did not include the plaintiffs in a priority distribution of “customer property” under 11 U.S.C. §§761-767, which governs the bankruptcy of a futures commissions merchant. Opinion below.

Judge: Rovner

2017-08-08 – in re peregrine financial – amended

Author: Matt Lindblom

Carroll v. Takada

(7th Cir. July 18, 2017)

The Seventh Circuit affirms the bankruptcy court’s order sustaining the trustee’s objection to the debtors’ $30,000 exemption in trust assets. The debtors argued the spendthrift provisions in the trust prevented the interest from becoming property of the estate. The court holds that the trust interest fully vested before the debtors filed bankruptcy. An exemption was inappropriate and the interest was property of the estate. Opinion below.

Judge: Sykes

Attorney for Debtors: Julia D. Mannix

Attorney for Trustee: Zane Zielinski

2017-07-18 – in re carroll

Author: Matt Lindblom