Help Center

ABI Blog Exchange

Key Employee Retention Plans (KERPs) and Key Employee Incentive Plans (KEIPs) often are the subject of intense interest, either because a distressed company’s management is focused on developing such programs to retain valuable talent during a time of great uncertainty within its organization or because certain creditor constituencies or parties in interest take issue with the payments a debtor intends to make under the programs.  The debtor’s experience in In re American Eagle Energy Corporation was no different.  There, the U.S. Trustee and a secured creditor objected to the debtor’s proposed KEIP, arguing it was a disguised, prohibited KERP.  The Bankruptcy Court for the District of Colorado, however, found otherwise and approved the plan. 
3 hours 31 min ago
The Department of Labor has finalized new overtime laws. The new federal law, which includes Wisconsin, will take effect on December 1, 2016. The Fair Labor Standards Act (FLSA), 29 U.S.C. §§ 201-219, requires employers to pay workers an overtime rate for hours worked in excess of 40 hours per week. With so many Americans working longer hours and not being fairly compensated for that time, the new employment law will benefit many individuals. If you are in an executive or managerial position, you may be jumping up and down about the new revisions. The good news is that the wage threshold for salaried workers has changed. This means more salaried employees will be eligible for overtime pay. Previously, the salary threshold was set at $23,600 a year or $455 a week, low numbers that employers were using to take advantage of employees. The new revision increases the salary threshold to $47,476 a year or $913 a week to qualify for an executive, administrative, or computer employee exemption. The new salary threshold aims to reduce the number of salaried employees who are not receiving overtime pay for additional hours worked.

Read More from: Wynn at Law, LLC

4 hours 58 min ago
Posted by Kathy Bazoian Phelps    Below is a summary of the activity reported for June 2016. The reported stories reflect: 4 guilty pleas or convictions in pending cases; over 39 years of newly imposed sentences for people involved in Ponzi schemes; at least 14 new Ponzi schemes worldwide; and an average age of approximately 59 for the alleged Ponzi schemers. Please feel free to post comments about these or other Ponzi schemes that I may have missed. And please remember that I am just relaying what’s in the news, not writing or verifying it.    Charles E. Bennett, 57, was disbarred from the Bar of the State of New York. Matter of Bennett, 2016 N.Y. App. Div. LEXIS 4176 (Sup. NY, June 2, 2016). Bennett is a former corporate lawyer at Skadden, Arps, Slate, Meagher & Flom, who was sentenced to 5 years in prison for running a $5 million Ponzi scheme. Bennett had left a suicide note before trying to kill himself which revealed the scheme that defrauded 30 friends and family members. Bennett survived the suicide attempt.    Andrew Caspersen, 39, was indicted on allegations that he ran a $40 million Ponzi scheme over an 18 month period. Caspersen pleaded not guilty to the charges, claiming that he had uncontrollable gambling addiction. Caspersen told the judge that he had been treated for “compulsive gambling and mental health illness.” He is expected to plead guilty next month.    Thomas J.

Read More from: The Ponzi Blog

5 hours 7 min ago
A recent US Supreme Court ruling will likely have a major impact on some individuals who file for bankruptcy in the future. The key issue that the Court had to determine in Husky International Electronics, Inc. v. Ritz was what exactly Congress meant when it referred to “actual fraud” in the Bankruptcy Code. In a 7-1 decision, the Supreme Court held that the term “actual fraud” in Section 523(a)(2)(A) of the Bankruptcy Code encompasses conveyance schemes, even when those schemes do not involve a false representation. In other words: the case represented a major victory for creditors because it expanded the scope of what is meant by “actual fraud.” Creditors and lenders will now be able to more effectively go after someone who improperly transfers their assets during a bankruptcy filing. What Husky v. Ritz Was About Husky International sold electronic device boards to Chrysalis Manufacturing Corp. Over a period of four years, Chrysalis made many purchases and racked up a debt of $164,000. While Chrysalis was accumulating this debt, the company was also transferring money and other assets to other entities, essentially shielding those assets from future debt collection efforts. This became a major issue when Husky attempted to collect on the debt and Chrysalis subsequently filed for bankruptcy.
7 hours 25 min ago
If your car was recently repossessed by the finance company, you have the ability under Chapter 13 bankruptcy law to recover that vehicle. You do so by filing a Chapter 13 bankruptcy case and proposing a plan to reorganize or repay that auto debt over time. You can reduce the interest rate owed to the+ Read More The post Recover Your Car Under Chapter 13 Or Obtain A New Car Under Chapter 7 appeared first on David M. Siegel.
9 hours 27 min ago
In a recent decision, the U.S. Bankruptcy Court for the District of Delaware refused to enforce a provision in the debtor’s LLC operating agreement requiring a unanimous vote of the debtor’s members to authorize the debtor to file for bankruptcy.  In re Intervention Energy Holdings, LLC, et al., 2016 Bankr. LEXIS 2241 (Bankr. D. Del. June 3, 2016).  The provision at issue required the consent of all the debtor’s LLC members to file for bankruptcy, including the consent of a member that was a secured creditor holding one unit of ownership in the debtor’s LLC which it bargained for and received pursuant to a forbearance agreement.  In refusing to dismiss the debtor’s bankruptcy case, the Court concluded that such an arrangement giving the secured lender a so-called “golden share” was “tantamount to an absolute waiver” of the debtor’s right to seek bankruptcy protection and therefore void as a matter of federal public policy.
11 hours 35 min ago
Attendees at the recent White House fintech summit shined a spotlight on shared innovation challenges. To overcome them and help the U.S. make progress in financial services, we need to embrace these three regulatory reforms.

Read More from: BankThink

13 hours 26 min ago
Receiving Wide Coverage ... Everybody breathe: That could have gone a whole lot worse. The Federal Reserve unveiled the results of the second part of its annual stress tests on Wednesday and just two banks failed – the U.S. units of Deutsche Bank and Banco Santander had their capital plans rejected. Both are repeat offenders that have had trouble with the exams in the past. ...

Read More from: BankThink

14 hours 1 min ago
Triangle USA Petroleum Corporation and five of its affiliates, including its Ranger Fabrication business, have filed chapter 11 petitions before the United States Bankruptcy Court for the District of Delaware (Lead Case No. 16-11566).  The debtors are an independent energy company with a strategic focus on the Bakken Shale and Three Forks formations in the Williston Basin, with their headquarters in Denver, Colorado.  The filings do not include Tringle Petroleum Corporation (NYSE: TPLM) or the debtors’ RockPile Energy, Elmsworth Energy, Caliber Midstream or Optic Infrastructure Development affiliates.  The Ranger Fabrication business is being wound down.  The debtors have entered into a Plan Support Agreement with the holders of 73% of their senior unsecured notes to reorganize the Triangle USA business.  The petitions (including the consolidated list of top 20 creditors), the first day declaration and the docket are available through Prime Clerk.  The debtors have issued a press release regarding their reorganization.
14 hours 42 min ago
Many of our clients schedule an appointment with our office because they are struggling to save their home from foreclosure proceedings.  A bankruptcy filing stops foreclosures as long as they are filed PRIOR to the foreclosure date.  What then?  Many times, the reason the foreclosure is set is because the monthly payment requirement is more than a client can afford as a result of reduced income due to layoffs or loss of job altogether.  What options are available?  One option is the HAMP program. What is HAMP? HAMP stands for Home Affordable Modification Program.  This program was started to help borrowers and investors.  It is a component of making homes affordable initiative.  The uniform modification characteristics are to reduce payment up to 31% of gross monthly income for HAMP Tier 1 and by any amount for HAMP Tier 2.  HAMP Tier 1 looks at two parts to calculate an affordable modified payment and then to see if the modification is in the best interest of the owners of the loan.  HAMP Tier 2 is offered to people who fail or are not eligible for standard HAMP modifications.

Read More from: Bonds & Botes, P.C.

14 hours 55 min ago
[wsj-responsive-image P="//art.wsj.net/api/photos/27217755/smartcrop?height=499&width=749" J="//art.wsj.net/api/photos/27217755/smartcrop?height=639&width=959" M="//art.wsj.net/api/photos/27217755/smartcrop?height=853&width=1280" caption="Residents of the Morro da Mineira favela play in the newly installed soccer pitch powered by player's footsteps, in Rio de Janeiro, Brazil, on Sept. 10, 2014. The project, sponsored by British oil giant Shell, has around 200 energy-capturing tiles installed along the width and breadth of the field and covered by a layer of AstroTurf." credit="Associated Press" placement="Inline" suppressEnlarge="false" ] Synthetic grass maker AstroTurf LLC filed for bankruptcy protection. Read the Daily Bankruptcy Review article via The Wall Street Journal. (Daily Bankruptcy Review is a daily newsletter with comprehensive coverage and analysis of emerging and in-progress insolvencies and turnarounds. For a two-week trial, visit http://on.wsj.com/DJBankruptcyNews, scroll to the bottom and click “try for free.”) A Brazil court accepted telecom company Oi SA’s request for bankruptcy, WSJ reports.

Read More from: WSJ.com: Bankruptcy Beat

15 hours 18 min ago
By: Donald L Swanson Unsecured Claim + Bankruptcy = You Lose. I came up with this formula back in 1983, while preparing for a seminar presentation on basic bankruptcy law.  I was trying to come up with something creative to say.  And . . . I must confess . . . I thought it was pretty clever at the time. And now . . . I’m more-than-a-little pleased and proud [or as people say these days, “humbled”] that the formula proves to be accurate in the vast majority of all bankruptcy cases. But what’s true in the vast majority of all bankruptcy cases has little to do with the Nortel Networks bankruptcy. And so it is with my little formula — it has nothing to do with the Nortel Networks bankruptcy case.  Nothing. Get this! Back in July of 2015 (when total professional fees expended in the battle are only $1.3 billion), the Bankruptcy Court makes this finding: –“A pro rata distribution would result in all Creditors receiving an approximate 71% return on their Claims.” Say what?!  A 71% return?! All this fighting has now cost $2 billion in professional fees.  And it’s over the last 29% of recovery?! . . . Oh, my. Unsecured creditors in nearly all bankruptcy cases would exult over a 71% return. But no.  Not for Nortel Networks creditors.  “A 71% return” are fighting words. “Don’t be settling these disputes in mediation,” seems to have been the battle cry.

Read More from: Mediatbankry

17 hours 2 min ago
Great info on Student Loan Apocalypse on the Student Loan Apocalypse mybudget360 website.   OK, they call it Student Debt Apocalypse. So I googled Student Loan Apocalypse, and, there are multiple entries going back two and three years. Student Loan Apocalypse:  Crying Wolf? I think not. From the mybudget360 site:
Student debt apocalypse: Median wages up 1.6% over last 25 years while median student debt is up 163.8%.
  That statistic makes the point nicely. Chart?  Chart.
This is not good.  Since 1990 debt has nearly tripled as a share of the typical college graduate’s annual wages meaning it is tougher to service that debt.  Sure rates are low but who does this benefit?  Lower wages merely inflate the underlying asset, in this class a college education on the back of easy financing.
A picture worth ten thousand words. The student loan apocalypse is predicted partly because, 11 years ago, that debt was 260 billion.  At over 1.3 trillion, yes, trillion, dollars, that is an extra TRILLION dollars added in just over a decade. Student Loan Apocalypse:  C’mon, Is It Really That Bad? Well, no.

Read More from: Discharge Student Loan

22 hours 41 min ago
Appellate courts in New York and Florida recently ruled that mortgage lenders “holding” electronic notes had standing to foreclose on the real property securing the E-Notes. Although Congress passed the Electronic Signatures in Global and National Commerce Act (ESIGN) in 2000, and nearly all states have passed the Uniform Electronic Transactions Act (UETA) in the last decade, there have been very few cases addressing and confirming the enforceability of E-Notes.  Last year, the Consumer Financial Protection Bureau opined that e-mortgage lending can benefit consumers.  These cases may reduce lenders’ perceived risks and provide greater certainty enforcing electronic documents.

Read More from: Creditors' Sidebar

1 day 8 hours ago
From Diane: In line with our firm’s commitment to financial education I suggest reading this short article about the CFPB’s focus on helping manage money, achieve financial goals and attain greater financial stability.  The following are some very helpful tips on rebuilding credit, plus lots more.
The following is a reprint of: Prepared Remarks of Richard Cordray Director of the Consumer Financial Protection Bureau “CFPB” Financial Literacy and Education Commission Meeting Washington, D.C. June 29, 2016 Over the past five years, the Bureau has focused on helping to create a financial marketplace that works for consumers, not against them. We try to do this by both protecting and supporting consumers. Our work to protect consumers involves making the rules governing the marketplace more effective, consistently and fairly enforcing those rules, and engaging in evenhanded oversight of financial institutions. Our work to support consumers includes creating resources and information directly for the public to use and engaging in foundational research to spread effective approaches to financial education.
1 day 9 hours ago
Co-Authored by Jessica Schauwecker, Summer Associate at Weil Gotshal & Manges, LLP in Dallas. Restructuring professionals and distressed debt traders that are new to the oil and gas industry have not had only to deal with the reality of oil price fluctuations, but they have also had to learn an entirely different deal vocabulary.  Leases that are not really leases, farmout agreements that have nothing to do with farming, royalties that are actually ownership interests in the production, rather than a mere contractual obligation to pay, and working interests that are also ownership interests in production, but which require actual work and the payment of costs to maintain.  Moreover, rights and property interests may be different – both inside and outside of bankruptcy –depending on which state law applies.   The Oklahoma Supreme Court recently issued an opinion of interest to those who practice and invest in this industry, as it could substantially affect the value of certain bargained for rights (although any temptation to ascribe the holding to the peculiarities of the law applicable to oil and gas should be resisted).
1 day 9 hours ago
Yesterday, the Supreme Court granted certiorari in Czyzewski v. Jevic Holding Corp (“Jevic”). As previously reported, Jevic addressed whether a bankruptcy court can approve a settlement agreement that provides for distributions that violate the absolute priority rules as part of the structured dismissal of a chapter 11 proceeding. The Third Circuit held that such structured dismissals were appropriate even when they provided for distributions that do not strictly comply with the Bankruptcy Code’s absolute priority schemes.  The Third Circuit’s ruling is consistent with the Second Circuit’s holding in In re Iridium Operating LLC,[1] which held that such structured dismissals may be appropriate if they are justified by other factors, but put the Third Circuit in conflict with the Fifth Circuit, which held in Matter of AWECO, Inc.[2] that it was inappropriate to approve a structured dismissal that did not strictly comply with the absolute priority rule.

Read More from: Hughes Hubbard & Reed

1 day 10 hours ago
The cryptocurrency ecosystem operates on the fringes of tradition, with "initial coin offerings" announced, discussed and carried out largely via online forums and without regulation. The phenomenon is high-risk and should be treated as such.

Read More from: BankThink

1 day 10 hours ago
[wsj-responsive-image P="//art.wsj.net/api/photos/33650651/smartcrop?height=499&width=749" J="//art.wsj.net/api/photos/33650651/smartcrop?height=639&width=959" M="//art.wsj.net/api/photos/33650651/smartcrop?height=853&width=1280" credit="European Pressphoto Agency" placement="Inline" suppressEnlarge="false" ] The law firm that has bailed colleges and universities out of NCAA athletic-compliance trouble is getting dragged into the bankruptcy courtroom, where fights are increasingly breaking out over tuition payments. The Bond, Schoeneck & King firm is representing several colleges that face demands to return tuition payments made by a student’s parents. That money, court-appointed bankruptcy officials argue, should have paid off the parents’ own bills. The disputes have put repayment pressure on at least 49 colleges and universities, according to a Wall Street Journal tally. Skidmore College officials, for example, hired Bond lawyers to help them keep $87,807 that a Georgia mother paid for her daughter’s education at the private college in Saratoga Springs, N.Y.

Read More from: WSJ.com: Bankruptcy Beat

1 day 11 hours ago
Thomas Edison famously said that “opportunity is missed by most people because it is dressed in overalls and looks like work.”  Consistent with Edison’s musings, companies in an acquisition mode often overlook opportunities that arise in the bankruptcy arena because they lack knowledge of the system and think bankruptcy is an unruly beast dressed in extra-large overalls.  For companies seeking to acquire going concern businesses, real estate assets, liquidated equipment and rolling stock, or distressed debt, however, bankruptcy purchase opportunities are plentiful, usually at below market prices with potential high margin rewards.  Chapter 11 creates a buyer-friendly market for asset sales because (i) assets can be sold free and clear of liens, claims and encumbrances; (ii) going concern value can be preserved during the sale process; (iii) sales can proceed on an expedited basis without the kind of full marketing efforts of a solvent owner; and (iv) initial bidders can obtain protections such as break-up fees and expense reimbursement to protect them from being overbid.  Opportunistic companies can improve their market share by acquiring the business or strategic assets of a failing competitor, or simply add a new line of business to their enterprise, by purchasing through a bankruptcy sale.  Over the last five years, Maryland bankruptcy courts have overseen the disposition of assets ranging from residential real estate lots, shopping centers, apartment complexes, banks, loa
1 day 12 hours ago

Pages