In re Melcher

(Bankr. E.D. Ky. Sep. 8, 2017)

The bankruptcy court grants the creditor’s motion to dismiss the Chapter 7 case because the debtor failed to rebut the “presumption of abuse.” The debtor argued she should be permitted to file under Chapter 7 because of special circumstances, pursuant to § 707(b)(2)(B). The debtor argued that she was a “stockbroker” and thus not eligible for Chapter 11 or 13. However, the court determines that she is not a stockbroker because she is merely an employee, rather than a stockbroker as defined by § 101. Opinion below.

Judge: Wise

Attorney for Debtor: Stuart P. Brown

Attorney for Creditor: Nicholas A. Zingarelli

2017-09-08 – in re melcher

Author: Matt Lindblom

In re Witty

(Bankr. W.D. Ky. Jan. 4, 2016)

The bankruptcy court denies the United States Trustee’s (“UST”) motion to dismiss the Chapter 7 bankruptcy case under 11 U.S.C. § 707(b). The UST argued that the debtor’s monthly expenses were excessive. The court finds that the expenses are not excessive considering the debtor’s current employment demands significant expenses for travel and clothing. The compensation warranted the expenses, and the debtor was required to travel for weekend visits with her children following her 2013 divorce. Opinion below.

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Author: Matt Lindblom

In re Horn

(Bankr. S.D. Ind. Jan. 4, 2016)

The bankruptcy court denies the United States Trustee’s (“UST”) motion to dismiss the Chapter 7 bankruptcy case under 11 U.S.C. § 707(b). The UST did not argue that the debtor filed in bad faith, but instead the totality of the circumstances of the debtor’s financial situation warranted dismissal. The debtor scheduled significant monthly retirement payments and tax overpayments that the UST contended could be used to fund a Chapter 13 plan. The court finds that the circumstances here did not warrant dismissal, in part due to the debtor’s age and retirement savings to date. Opinion below.

2016-01-04 – in re horn

Author: Matt Lindblom

In re Peterson

(Bankr. S.D. Ind. Feb. 4, 2015)

The bankruptcy court denies the creditor’s motion to dismiss or convert the chapter 7 case. The creditor had obtained a judgment against the debtor and her employer for the debtor’s unlawful accessing and dissemination of the creditor’s medical information. The creditor sought dismissal of the case under § 707(b) (failure of means test), but the court determined the debtor’s debts were not primarily consumer debts and thus that section did not apply. While the judgment was not a business debt, that did not necessarily mean it was a consumer debt. The creditor also sought dismissal for cause under § 707(a). The court recognized that seeking to pay a large debt of one creditor is a factor in favor of dismissal, but that alone did not warrant dismissal for cause. There was no evidence of the debtor’s ability to pay the large judgment. Finally, the creditor alternatively sought to convert the case to chapter 11, but the court denied the request, finding no credible evidence of the debtor’s ability to pay the debt or that chapter 11 would benefit creditors more than chapter 7 (in part because the creditor could collect the judgment from the debtor’s employer). Opinion below.

2015-02-04 – in re peterson

Author: Matt Lindblom