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THESIS TOPICS Dated: June 1, 2012

FOR ADVANCED RESEARCH/THESIS COURSE


ASSEMBLED BY PROFESSOR LIEB

1A. MULTIPLE DEBTORS IMPAIRED CLSASS REQUIREMENT -Section 1129(a)(10)s requirement for confirmation provides that if any class is
impaired under a plan, at least one impaired class must have accepted the plan.
Where a plan covers several debtors, is acceptance by one class sufficient, or must
there be an acceptance by a class of claims against each of the debtors? Held in The
Tribune Company, et al, 464 B R 126 (Bankr D Del 2011): compliance is required
by each debtor

2A. Successor liability/bankruptcy: May section 363(f) be used to sell property


free and clear of future successor liability claims? See Grumman Olson LLC v.
Frederico, __B R__, 2012 WL 1038672 (SDNY March 29, 2012), and cases cited
therein, including In re Chrysler LLC, 576 F.3d 108, 126 (vacated as moot, 130 s Ct
1015).; as to future claims, see alswo Wright v Owens Corning, 2012 WL 1759992
(3d Cir May 18 2012). Also cover (a) the question as to what constitutes an interest in
property within the meaning of section 363(f), discussed in In re PBBPC, Inc., __B R
__, 2012 WL 629057 (Bankr D Mass), and (b) issue over notice of bankruptcy sale (see
Grumman Olson, supra, and In re Ritchie Risk, 2012 WL 1859683 (Bankr SDNY May
22, 2012). See also, General Motors, 407 BR 463 (Bankr SDNY 2009); Chrysler, 2nd

Cir and S Ct. See Professor Charles Kuney's article in 76 Am Bankr L J.235 (2002)
and in the April 2010 Norton Journal of Bankr L and Prac.. Is such claim an
"interest in property" within the meaning of section 363(f), and if sold free and
clear, is the claimant entitled to adequate protection under 363(e) (and what
protection is required?) May such a free and clear sale be made pursuant to a
confirmed plan. Can a successor liability claim be discharged by a confirmation
order by virtue of section 1141(d) in conjunction with section 363(0? See
Miskowski, 415 F. 3d 501, and a 2005 Harvard Law Review article. After a
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bankruptcy case has been concluded, does the bankruptcy court have jurisdiction to
enforce the provision for a free and clear sale, and, if so, will it exercise its
jurisdiction?

3A. Enforceability of no shop provisions in bankruptcy cases. See In re Los


Angeles Dodgers LLC, 465 B R 18 (Bankr D Del) for an extensive analysis
4A. AVOIDANCE CLAIMS GOOD FAITH DEFENSE: Meaning of good faith for
the purpose of the good faith defense to avoidance claims as provided by sections 548(c) and
550(b)(1). See comment on the 2011 decision in Teleservices, 444 BR 767 in the April
2012 ABI Journal, page 20. What is the scope of the rights of a good faith initial transferee
and subsequent transferees under section 548(c) and under section 550? Does a good faith
transferee have any other statutory or any non-statutory defense to an avoidance action
under federal law, or under state law if the trustee asserts a section 544 avoidance claim?
See BJ Jeff Hughs lengthy decision in Teleservices Group, Inc., 444 B R 767 (Bankr N D
Ohio 2011) (addressing good faith as used in sections 548(c) and 550(b). See also, CNB,
440 BR 31; Nieves, __F.3d__ (4th Cir June 2011); TOUSA, 444 BR 613 (SD Fla); JTS,
617 F.3d 1102.

5A. AVOIDANCE INTENTIONAL FRAUD: Avoidance of a transfer under


section 548(a)(1)(A) is provided for where the transfer was made with actual intent
to hinder, delay, or defraud. (emphasis added). Is hinder or delay, without intent to
defraud, sufficient for avoidance? Held yes: see J Cardozo writing Shapiro v Wilgus,
287 U S 348, 354, and Nisselson, 376 B R 390, 403. Is merely hindering without
proving the debtors insolvency or insufficiency of capital, as required for the
constructive fraudulent providsion, sufficient for avoidance of the transfer?

6A.TORT VICTIMS PRIORITY: Priority level of claims of tort victims filed


against the debtor estate. See In re Rescources Technology Corp., 662 F.3d 472 (7th
Cir 2011) (Posner , J), and consider Reading Co v Brown, 391 U S 471 (1968). See
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also an article in the February 2012 ABI Journal .

7A. RECONSIDERATION OF CLAIMS: Consider the test for when claims in


bankruptcy may be reconsidered as authorized by section 502(j), and the realionship
of that provision to Bankruptcy Rule 9024, incorporating Rule 60(b) of the Def Riles
of Civ Proc. See In re Yellowstone Mountain Club, LLC (Bankr D Mont. March 9,
2012). Consider whether section 502(j) is a meaningful protection for a claimant
whose claim for indemnity is disallowed under section 502(e)(1)(B) (see In re
Carribbean Petroleum, __B.R. __, Bankr D Del. May 24, 2012).

8A. Post confirmation jurisdiction under 28 USC section 1334(b): Courts tend to
apply a close nexus test. See In re Metro-Goldman-Mayer Studios, Inc., 459 B R
550 (Bankr SDNY), which applied that test and held that juridiction was lacking
with respect to A post-confirmation transaction. Is that test too narrow.? The briefs
in that case were prepared by eminent counsel and should be examined.

9A. Allowability of filing class proofs of claim in bankruotcy cases. See Gentry V Siegel
as Liquidating Trustee for Circuit City Stroes, Inc. , 668 F.3d 83 (4th Cir. 2012) and
Bankruptcy Rule 7023. -May class action settlement proceeds be integrated with a

chapter 11 plan of reorganization? See Bally Total Fitness, Bankr. SDNY, April 7, 2009.
See also an article in 17 Norton Journal of Bankruptcy Law and Practice, Issue 6, page 793
(December 2008)
10A. Strip off and strip down of liens: May a chapter 7 debtor strip off a lien that
has no collateral value so as to render it an unsecured claim under section 506(a)? See
conflicting cases, including Pomilio, 425 B R 11 and Lavelle, 2009 WL 4043089. Both
cases consider Dusnup v Timm, 502 U S 410 holding that a chapter 7 debtor cannot strip
down a lien to the value of the collateral. See also, In re Cook, 432 BR 519 (Bankr D NJ
2010).

Also, Allowability of strip down and strip off of secured claims in chapter 13
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cases.. See In re Sarno, 463 B R 163 (Bankr D Mass 2011); and In re Miller, 462 B
R 421 (Bankr EDNY 2011)

11A. Third pary payment of legal fees: Where a fee for legal services provided to
a debtor in banruptcy is to be paid by a third party, must the fee be allowed by court
order in accordance with sections 330 and 331 before the payment may be made or
used by the attorney? See In re Holly Marine Towing, Incorporated, __F3d__, 2012
WL 32065 (7th Cir 2012).

12A. Substantive consolidation: Does a bankruptcy court have authority to substantively


consolidate a non-debtor entity with a chapter 11 debtor? See also, In re S & G Financial
Services, 451 B R 573 (Bankr SD Fla 2011)See also, In re Pearlman, 462 B R 849 (Bankr

M D Fla 2012), and if so, would such consolidation viola te a fifth amendment right of the
non-debtor and its creditors?
13A. The meaning of defalcation within the meaning of the section 523(a)(4)
non-dischargeability provision. There is a Circuit conflict. See In re Bullock,
__F.3d__,

______WL ___ (11th Cir. February 14, 2012)

15A. Stern v. Marshall: Scope of appellate jurisdiction of various bankruptcy


court orders in the aftermath of Stern v. Marshall, 131 S Ct 2594 (2011). See In re
Trinsum Group, Inc., 2012 WL 1194100 (Bankr SDNY April 9, 2012).

16A. When do unknown future claims constitute claims within the meaning of
section 101(5)(A) (thereby discharging the debt giving rise to such claims)? See
Wright v. Owens Corning, 2012 WL 1759992 (3d Cir. May 18, 2012), and In re
Grumman Olson v. Frederico, 2012 WL 1038672 at *6 (SDNY March 29, 2012).

17A. JUDICIAL ESTOPPEL-- The elements and scope of the doctrine of judicial
estoppel -- Discuss the application of that doctrine.See Reed v City of Arlington,
650 F.3d 571, 572-573 (5th Cir. 2011). See also In re Adelphia Recovery Trust, 634
F.3d 678 (2d Cir. 2011) (barred a chapter 11 debtor in possession from bringing
fraudulent transfer claims). See also earlier decision in Adelphia of the Bankruptcy
and District Courts on judicial estoppel, and the later decision of the District Court in
Adelphia Recovery Trust v Key Bank, __B R __ (WDNY May 18, 2012)

18A. Termination of retiree benefits section 1114: Consider whether retiree


benefits, defined by section 1114(a), may be yterminated unilaterally by a debtor in
possession or trustee during the bankrupt cy case pursuant to a termination provision
of the governing contract or benefit plan, without regard to the limitations or
prohibition of section 1114, or must such payments be continued until there has been
a modification in accordance with 1114. Case law is in conflict. Is 1114(a)
ambiguous as to whether the controlling cponcept is payments or benefits? Are
there plausible argumewnts to support each side. What is the impact of ERISA and
its purpose?

19A.SECTION 502(d) DISALLOWANCE--Does section 502(d) require the


disallowance of a claim held by a purchaser of the claim unless a voidable preference
received by the original claimant who sold the claim, is paid back to the estate? In
that connection, consider whether, as required by section 502(d), the property is
recoverable from the purchaser in ligh t of the section 550(b) good faith defense -does that defense apply, and is it available where the potential defendants who could
have liability on the preference claims were listed on the debtors filed statement of
affairs prior to the sale of the claims? See In re KB Toys, Inc., 2012 WL 1570755
(Bankr D Del May 4, 2012).
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20A. Releasesderivative liability: For a non-debtors claim against another nondebtor to be released, or its prosecution enjoined, by a chapter 11 plan, must the
entity whose claim is to be released be derivatively liable for the debtors liability to
the injured claimant? See In re Quigley, 676 F.3d 45 (2d Cir.2012), and expalaining
(reconciling) its earlier confusing decisions on derivative liability and subject matter
jurisdiction beginning with MacArthur. Consider also, Travelers v. Bailey, 127 S Ct
1199 (2007), where the Court accepted but did not decide the issue.
21A. Suits by trustees and DIPs effect of debtor misconduct: Consider the extent to
which a debtors participation with the defendant in misconduct bars a bankruptcy trustee or
debtor in possession from asserting against the defendant the claim arising from such
misconduct under the doctrine of in pari delicto. Does Reed v. City of Arlington, 650 F.3d
571 (dealing with judicial estoppel) establish a new approach to depart from in pari delicto?
Consider the decisions of the 2nd Circuit, relying on answers by the NY Court of Appeals to
certified questions, and of other Circuits. Also, consider whether the doctrine, as applied in
receivership cases, should be extended to bankruptcy cases. Is in pari delicto a defense to

an action by a bankruptcy trustee or debtor in possession ("DIP") against a director or


officer of the debtor or a third party, such as an accountant or attorney, based on a debtor's
pre- petition claim? See Kirschner v. KPMG, 15 N Y 3d 446 (2010), answering questions
certified by 2d Circuit to NY Court of Appeals; and subsequent decision of 2d Circuit in
626 F.3d 673, dismissing the trustees suit by applying answers provided by the NY court.
In light of Wagoner, 944 F.3d 114 (2d Cir. 1991), does a bankruptcy trustee have
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standing to bring such a suit (and see other Circuits that reject Wagoner, holding that
in pari delicto is merely a defense to a trustees suit). See collection of citations and
discussion in Grede v. McGladrey & Pullen LLP, _BR_, 2009 WL 3094850 (9/29/09),
and also in section III(A)(2) of In re Food Management Group, (Banks SDNY January
23, 2008); In re TOCFHBI, Inc., 413 BR 523 (Bankr N.D. Tex 2009); In re The 1031
Tax Group, LLC, BR , Bankr SDNY 12/3/09; Nisselson, 1st Cir 2006, cert den 061160, Feb 23, 2007; Gregg, 2006 Annual Survey of Bankr L 117. See also In re Senior
Cottages of America, 8th Cir April 2007 (collusion of insiders with third parties to injure

the corporation did not deprive the corporation of standing to sue third parties); In re
Monahan Ford, 340 BR 1 (on "standing" at p 22 and discussing Wagoner rule). Should this

doctrine apply when a recovery could only benefit the creditor body, not the equity
owners?

22A. Do liens survive a bankruptcy of the debtor? Consider Johnson v Home


State Bank, 501 U S 78, 83-84 (1991) (the bankruptcy discharge injunction bars an
in personam action against the debtor, but not an an action in rem). But see In re
Heritage Highgate, 2012 WL 1664174 (3d Cir. May 14, 2012) (addressing lien
stripping in chapter 11 cases where the debtor retains the collateral). Consider
instances where the secured party does not make the section 111(b) election, and
those in which such election is made, focusing on footnote 10. Also consider the
Supreme Courts decision in Radlax, argued April 23, 2012 (decision expected in
June 2012)

23A. ASSIGNING VOTING RIGHTS: Consider whether an assignment of the right to


vote in a chapter 11 case, as contained in an inter-creditor agreement, is enforceable. Held
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no in In re SW Boston Hotel Venture, LLC, 2011 WL 5520928 (Bankr.D Mass. Nov 14,
2011). Numerous other cases are contra, including In re 203 North LaSalle Street, 246 B R
325 (Bankr. N D Ill 2000). Also consoider related questions, including whether a junior
creditors agreement not to oppose a senior creditors motion for adequate protection or to
enforce other provisions of an inter-creditor agreement are enforceable. Does section 1126
permit a transferee of voting rights to vote the claim or equity interest, where the transfer
has been effected by a sale of the vote, by a subordination agreement, by a subrogation
agreement, or another type of arrangement? See In re Avondale Gateway Center, 2011
WL 1376997 (D. Ariz).

24A. DEFAULT RATE OF INTEREST: Consider whether a default rate of


interest is part of a claimants allowed claim in bankruptcy. Is the principle the same
where the debt at issue is reinstated in accordance with section 1124, and also whether
default interest is recoverable where the only default under the applicable lending
agreement was the filing of a bankruptcy case by the borrower. Consider ipso facto
provisions of the Bankruptcy Code. See In re General Growth Properties, 451 B R
323 (Bankr SDNY 2011) (as of June 2012, on appeal to 2nd Circuit); and In re W R
Grace & Co (Bankr D Del 2009). See also, In re 785 Partners LLC, 2012 WL
1154282 (Bankr SDNY April 9, 2012). Does the recovery of charges depend on

whether the debt was accelerated voluntarily pursuant to a contract provision, or


as a matter of law by reason of the bankruptcy filing? See, In re Saint Vincents
Catholic Mediacal Centers, __BR__, 2010 WL 4553542 (Bankr SDNY ). Consider
also whether contractual default interest (ordinarily recoverable under Ron
Pair,489 U S 235) is recoverable under section 506(b), partiularly where the default
has been cured and the debt has been reinstated undersection 1124(2), and
1123(a)(5)(G) and 1123(d).See General Electric Capital v. Future Media, 536 F.3d
969 (9th Cir. 2008)

25A. Effect of equity origin of a claim: Consider the character of a debtors


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prepetition obligation to make payments to a shraeholder, such as to redeem the


shares pursuant to an agreement requiring the debtor to purchase them on the
shareholders retirement or under other circumstances. Does such obligation give
rise to a claim, or is it treated as a payment on an equity interest? Is thre result
different if there is a prepetition court order requiring payment, for example an order
in a state-law corporation law proceeding for appraisal and payme n t for the sahares
of a minori ty holder. See In re Orange County Nursery, Inc., 439 B R. 144 (C D Cal
2010).

26A. Use of bar orders, in bankruptcy cases limiting the time within which
claims must be filed, and barring (discharging) any claim that is not timely filed
within the the time allowed by the order. Consider requirements and limitations
applicable to such orders. See, The Tribune Co, 464 B R 126, 176 (Bankr D Del
2011).
27A. Stay relief and subject matter jurisdiction: -- Is stay relief required for a
debtor to appeal an order in a bankruptcy case? Cases are in conflict. See TW
Telecom Holdings, Inc., 661 F.3d 495 (10th Cir. 2011). If relief from the stay is
required, but not obtained, does the appellate court lack subject matter jurisdiction.
When is there a lack of jurisdictiuon or merely a violation of a procedural rule that
does not implicate subject matter jurisdiction
28A. Surcharging exempt property: May a debtors exempt property be
surcharged for the injury to the estate caused by the debtors wrongdoing or because
the debtor in essence has exempted more property than is allowed by law. Cases are
in conflict. See In re Malley (1st Cir 2012)

30A. Confirmation good faith requirement: The meaning of good faith for
purposes of the confirmation requirement in section 1129(a)(3). See In re Quigley,
53 BCD 170 (Bankr SDNY 2010).

31A. DIP operation of businessstate laws : The scope of 28 USC section


959(b) requiring that the trustee and debtor in possession operate anfd manage the
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property in its possession accordsing to the requirements of valid state laws.

32A. Dissallowance of claim on equitable grounds: May a claim be disallowed


on equitable grounds, although that is not a ground specified by section 502(b). See
Washington Mutual, 2011 WL 4090757 at *44 to 56 (Bankr D Del)

33A. Assumption despite non-curable defaults: May an


executory contract be assumed where there is a non-curable default. See In re
Clarement, 113 F.3d 1029 (9th Cir. 1997) and In re Bankvest, 360 F.3d 291 (1st Cir.
2004). Does a default under a time of the essence clause in a contract, or other

uncurable default thereunder, prevent the assumption of the contract? See Escarent
Entities, __F.3d__, 2011 WL 1659512 (5th Cir 2011). See also Empire Equities
Capital Corp., _BR_ (Bankr SDNY 6/3/09). Consider the impact of the 2005
amendment t section 365(b)(2)(D) and 365(b)(1)(A). See In re Escarent, 2011 WL
1659512 (5th Cir. 2011)

A. Director and Officer insurance policies: Are D & O policies or the proceeds
of such policies property of the estate within the meaning of section 541? May
insurance proceeds be advanced to directors or officers for litigation defense costs?
See numerous circuit cases, and In re Downey Financial Corp., 2010 WL 1838565
(Bankr D Del); In re Mila, Inc., 52 BCD 210 (9th Cir BAP January 29, 2010); In re
World Health, Bankr. D Del, June 7, 2009

B. Liquidating Trusts in chapter 11 cases: What are their rights and


obligations, and what law governs them? May a liquidation trustee bring suit on claims
assigned to he trust? See Grede v The Bank of New York Mellon, 598 F.3d 899 (7th Cir
2010), distinguishing Caplin v Marine Midland. A 9th Cir decision is contra to Grede

D. Sale of avoidance claims: May a bankruptcy trustee sell avoidance claims


grounded in sections 544(b), 547 or 548. If so, do the standards for the use or sale of an
asset under section 363 govern the sale of an avoidance claim? See Matter of Moore, 608
10

F.3d 253 (5th Cir. 2010). Consider also In re Bogdan, 414 F3d 507 (4th Cir 2005); Grede v
Bank of NY , 598 F.3d 899 (7th Cir. 2010)

E. May bankruptcy judges exercise jurisdiction based on consent? If


Article III requires that a proceeding be determined by a life-tenured judge, may a nonArticle III bankruptcy judge determine the proceeding based on the consent of the parties?
May a the bankruptcy judge determine a proof of claim predicated on contract or tort
where an objection based on Article III to such a determination is made by the claimant?
Consider Stern v. Marshall, 130 S Ct 2594 (2011).

F. Administrative expenses and benefit to the estate: What is the test


for whether an expense is for preserving the estate within the meaning of section
503(b)(1)(A)? See extensive discussion in In re Sturgis Iron, 420 BR 716, by B J Hughes,
(holding that on lease rejection, the DIP must pay the actual lease rent, rather than
following the general rule requiring payment of only a reasonable amount). Is benefit to
the estate the test for the allowance of an administrative expense pursuant to section
503(b)(1)(A)? See Matter of Bodheimer et al, 592 F.3d 664 (5th Cir. 2009) Does the theory
of Randolph & Randolph v. Scruggs, 190 U S 533(1903) apply to that section? Consider
the history of that decision.See also, In re Tronox, 2012 WL 164926 (Bankr SDNY)

G. Section 363(b) sales: What is the standard for a sale pursuant to section
363(b) after the decisions in Chrysler (2d Cir.) and GM (Bankr. SDNY)? See also, In re
Gulf Coast Oil Corporation, 404 B R 407 (Bankr S D Tex 2009). Consider an opinion by
Bankruptcy Judge Randolph Haines issued in the past two years.

H. Mediation: (a) good faith effort. -- If mediation is ordered, is there an


obligation to mediate in good faith? If so, what is the test for whether there has been a
failure to mediate in good faith? See In re A.T. Reynolds & Sons, Inc.,424 B R 76 (Bankr
SDNY 2010), reversed 452 B R 374 (SDNY 2011). Consider the cases interpreting good
faith under section 1113(b)(2) and section 1114(f)(2), and the relevance of those cases or
their analysis. Also consider whether case law regarding the obligation to bargain in good
faith is relevant.
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(b) Discovery. ---A further issue is whether documents and communications made
or exchanged during a mediation may be discovered, or precluded to protect the
confidentiality of the mediation. See In re Tribune Co., 54 BCD 84 (Bankr D Del 2011)
(limited discovery permitted).

I.

Venue for a bankruptcy case: What is the test under 28 USC


section 1408 for venue for filing a bankruptcy case? Consider the
nerve center approach of The Hertz Corp v. Friend, 130 S Ct 1181
(2010)

K. The initial transferee under section 550(a)(1). Is the recipient of


transferred property an initial transferee or a mere conduit? This question was address
in Palorian v. LaSalle Bank, 619 F.3d 688 (7th Cir.2010) where a trustee of a trust
established as part of a securitization transaction was held not to be a mere conduit for
section 550 purposes. This leaves trustees exposed, and may make entities reluctant to
serve. See also, In re Harwell __F3d__, 2010 WL 5374340 (M D Florida) (atty
maintaining a trust account was not a mere conduit); Bonded Financial, 838 F.2d 890, 894
(7th Cir. 1988); and Palolian, 619 F.3d 688 (7th Cir. 2010).
L. Disallowance of the vote -- What is the test for designation (denial of the vote)
in a chapter 11 case under section 1126(e) Its purpose, history and present application .
See In re P-R Holding, 147 F.2d 895; In re DBSD, 634 F.3d 79 (2d Cir 2011); 48 The
Business Lawyer 915 (May 1993)
M. Veil piercing -- Is reverse veil-piercing a well grounded legal theory that
supports a claim by a bankruptcy trustee? See Matter of Moore, 53 BCD 68 (5th Cir. June
2, 2010)
N. Executory contracts performance during interim period -- Is the nondebtor party to an executory contract made with the debtor before its chapter 11 filing
required to perform its obligations thereunder during the period between the petition date
and the confirmation date, where the contract has not been assumed or rejected? Does a
12

failure to perform violate the automatic stay? During that pre-confirmation period, does
the chapter 11 debtor use the contract within the meaning of section 363 and is the nondebtor party entitled to have adequate protection of its contract rights under section
363(e)?

3. SUBORDINATION OF SHAREHOLDERS SECURITIES ACT CLAIMS What


constitutes a "security" within section 510(b), such that that provision subordinates a
fraud claim predicated thereon . See Rombo, 461 F.3d 251. Recent cases interpret section
510(b) broadly. Consider other provisions of the Bankr Code that deal specially with
securities act claims, such as dischargeability of such claims
4. PRECLUSIVE EFFECT OF CONFIRMATION ---Scope of
preclusive effect of a chapter 11 plan confirmation order. See Travelers Indemnity v.
Bailey, U S Supreme Court 2009 applying res judicata, and how that decision is being
applied. See also Klein, 79 Amer Banks L J 839, at 888-891 (2005). Specifically, can a
confirmation order discharge a claim under the doctrine of judicial estoppel or res
judicata? What is the test for each doctrine and how do they differ? See Krystal Cadillac,

337 F.3d 314, Eubanks, 2004 WL 2256015, DeLeon 321 F.3d 1289, and Cheng, 308 B.R.
448. See Parket v. Werdys, 9th Cir. April 15, 2004, questioning Burnes, 291 F. 3d 1282. See
also, Wachovia v. Eastman Kodak, 456 F3d 1277 (11th Cir 2006), cert den 127 S Ct 836

(2006) (the res judicata effect of a confirmation order did not preclude a subordinated
creditor's fraud suit against the senior creditor). There may be a circuit conflict.
5. END OF POST-CONFIRMATION JURISDICTION: When does postconfirmation jurisdiction end? - Revisiting Zerand-Bernal, 23 F.3d 159 (7th Cir. 1994),
and In re Conseco, 2004 WL 2913628. What is the test for the allowable scope of
postconfimiation jurisdiction? See Jamaica, 458 F3d 92; and In re Heritage Organization,
454 BR 353 (Bankr N D Tex 2011). See discussion of retention of jurisdiction in the plan
13

and the effect of 1123(b)(3)(B) in Lander, Postconfirmation Jurisdiction, April 2008


Norton Bankruptcy Law Adviser (Issue No. 4), pp. 5 through 11. See also In re MetroGoldman-Mayer Studios, 459 B R 550 (Bankr SDNY 2011) (upholding post conf jurisd
of a post-confirmation trandsaction under a new close nexus test.) Fing the case
written by Judge Learned Hand in the 1930s to the effect that such jurisdcition ends early
and the debtor is returned to the real world

6. SCOPE OF THE BANKRUPTCY COURTS' EQUITABLE


POWER --Scope of 105(a) as an equitable power, and its limitations. Is there a
federal common law of bankruptcy? See Central Virginia v. Katz, Sup Ct 2007.
Read Levitan, Toward a Federal Common Law of Bankruptcy, 80 Amer Bankr L J
1 (2006). See also Young v. United States, S. Ct. (2004); and Norwest Bank v.
Ahlers, 122 S. Ct. 1036. See Cybergenics, 330 F. 3d 58 (3d Cir. 2003) (en banc).

Also consider the following cases: In re Kalikow, 2010 WL 1407159 (2d


Cir);Grupo Mexicano; Taylor, 306 U.S. 307; Pepper v. Litton 308 U.S. 295;
Continental Illinois, 294 U.S. 648. The equity power of the federal courts has been

held generally to override state law rights of creditors despite Butner and
Raleigh v. Illinois. See also Noland and C, F and I, 518 U.S. 213. See also,

Marrama, 127 S. Ct. 1105 (2006)


7. APPELLATE STANDING --Bankruptcy appeals -- who is an "aggrieved" party? Traditional
principle governing appellate standing, per Cosmopolitan Aviation
763 F2d 507 (2d Cir 1985), requires a person aggrieved. Does
section 1109(b)s plain text confer appellate standing with respect
to any issue in the case. Nothing in the 1978 legislation carried
section 39(c) of the 1938 Act into the new legislation. See also
Commodore, 262 F.3d 96, Coral 796 F.3d F.2d 1351, 1362, PharMor, 22 F. 3d 1228, 1241; Derek 207 B.R. 899, 904; and Coho

14

Energy, 2004; WL 976424 (5th Cir); Ikso Steel v. Blair, 3d Cir.

June 10, 2004; Urban Broadcasting, 4th Cir., March 11, 2005. See
also Fight v. Univision of Virginia, Inc., In re Urban
Broadcasting, 401 F.3d 236 (4th Cir. 2005). Consider whether a

remote or indirect interest is a sufficient basis for appellate


standing. See Telejet, __F.3d__, 2011 WL 1678401 (2d Cir. 2011);
Heating Oil, __F.3d __, (2d Cir May 16, 2011); Global Industries,
__F.3d__, 2011 WL 1662792 (3d Cir 2011). See also number 59.
Who has standing as a "party in interest" in a bankruptcy case other
than the DIP, trustee, creditors and equity security holders? See
Worldcom, 467 F3d 73; Grace, 443 F3d 180; In re Sobczak, 9th Cir

BAP May 11, 2007.

8. TRUSTEEs AND PROFESSIONALS' IMMUNITY --Scope of


liability and immunity of a bankruptcy trustee and his/her retained attorneys and
other professionals for negligence. See Zamorea v. Virtue, CD Cal 8/21/09 and
McClelland v. G & E Consulting Services Co., Bankr. SDNY 10/16/09
9. CONSTRUCTIVE TRUSTS ---Are constructive trusts recognized and enforced
against trustees and debtors in bankruptcy cases? Is the property against which a trust
is sought "property of the estate" and is such an equitable right a "claim" within the
meaning of section 101(5)? See decisions issued in 2010 and 2011 by the Second and
Third Circuits, and by the Fifth Cir (in In re Moore) See also Davis, 2004 WL
575101. First Central, 377 F. 3d 209 (2d Cir. 2004); Ryan, 316 B.R. 101 (D. Conn.
2004). Read In re MJK Clearing, Inc, 8th Circuit, June 9, 2004; Ades, 550 F.3rd
240 (2d Cir.) Does the constructive trust doctrine have a place in bankruptcy cases?
Professor Lieb wrote an article years ago on the subject in the Annual Survey of
Bankruptcy Law. See also, Washingtojhn Mutual, 450 BR 490; Quality Holstein, 752
F2d 1009; Seaway, 912 F2d 1125; Belisle, 877 F2d 512; Omegas, 16 F3d 1442; CRS,
225 B R 833; First Central, 377 F3d 209; Flanagan, 503 F3d 171; AE Liquidation,
Inc., Case No. 08-130-31, Adv No. 09-50029 (Bankr. D. Del. April 9, 2010).
15

Consider whether Travelers, 127 S Ct 1199 undermines First Central, supra.


Consider Judge Haines theory in In re Hoyt, 2011 WL 830274 at *5 (Bankr. D. Ariz.
March 10, 2011)
9A. CROSS-COLLATERIZATION: Is it permissible? May prepetition debt be rolled up into DIP financing so as to secure the pre-petition debt
with post-petition assets? See Chiasson, 4 F3d 1329, 1334

9B. DOES REJECTION TERMINATE the contract ---Does


rejection of an executory contract or lease pursuant to 365
terminate the contract or lease? See In re UAL Corp., __F3d__,
2011 WL 559702 (7th Cir 2011)
Do any provisions of a rejected contract, such as an arbitration
provision, survive the rejection? What are the consequences if
rejection does not terminate? Consider whether a claim for an
injunction to enforce a provision of a contract survives the rejection of
the contract. In re Ortiz. 400 B R 755,762 (C D Cal 2009); held yes as
to an exclusivity provision, collecting cases and citing the lead article
from 20 years ago.
See also, concurring opinion of Judge Ambro in Exide Techonology,
607 F.3d 957 (3d Cir 2010) (argues that, although a trademark is not
Intellectual property within section 365(n), the rejection of a
trademark license by the debtor-licensor does not terminate the
licensees license because rejection does not terminate the contract).
Consider also, McLaughlin v Walnut Properties, Inc. Court of

Appeal of the State of California, Second Appellate District,


Division 8, (Cal. App. Dist. 2), June 10, 2004. See also Richmond
Leasing, 762 F.2d 1303 (5th Cir 1985); Commercial Fin., 47 BR 425;
Cohen v Drexel, 138 BR 687, 703; In re Picnic, 58 BR 523. See

16

Andrews, Exec Contracts, 59 U Colo L Rev 845 (1988); Andrews,


.

62 U of Colo L Rev 1 (1991) replying to Westbrook; Westbrook,


Exec contracts, 74 Minn L Rev 227 (1989).

10.

PRESENT SCOPE OF THE ROOKER-

FELDMAN DOCTRINE-- Concurrent federal/state court jurisdiction - - scope of


the Rooker- Feldman doctrine in bankruptcy cases after Exon Mobile, 125 S Ct 1517.
There are many authorities. See In re Agard, __ B R __, 2011 WL 499959 (Bankr
EDNY) at *8 to *10; In re Ivani, 308 B.R. 132 (Bankruptcy EDNY 2004); In re

American Bridge, 52 BCD 243 (1st ir. March 10, 2010). Exxon, 125 S. Ct. 1517
(May 2005) limits Rooker- Feldman severely. What survives after Exxon, 125 S.Ct.
1517 (2005)? See also in re Knapper, 3rd Cir. May 24, 2005; Bridgewater, 346 F.
3d 27; Lopez, 9th Cir BAP April 2007.
12. ENVIRONMENTAL CLAIMS ---Do post-petition
environment clean up costs have administrative expense priority? Many authorities.
Consider G-I Holding, Inc, 308 B.R. 196 (Bankruptcy D.N.J 2004).
13.

BANKRUPTCY PREEMPTION ---Bankruptcy Code

preemption of state law. See Sherwood Partners v. Lycos (9th Cir) and numerous
other cases in Sup Ct and Circuit courts. See also In re Miles, 430 F.3d 1083 (9th
Cir. 2005); Watters v Wachovia Bank, 05-1342, US Sup Ct April 11, 2007; Hills,
Against Preemption, 82 NYU L Revl (2007). See also 63 The Business Lawyer
703 (Feb 2008) Does the S Ct's preemption test apply to provisions of the Bankr
Code?
14.

SUPPLEMENTAL JURISDICTION ---Can bankruptcy

courts exercise supplemental jurisdiction under the federal supplemental


jurisdiction statute, 28 USC section 1367(a)? There's a circuit conflict. See Sasson
v. Sokoloff, 424 F.3d 864 (9th Cir. 2005), cert den 126 5 Ct 2890. See the seminal

article written by Professor Susan Block-Lieb in the early 1990s. See also the
pleadings and briefs listed after 126 S CT 2890; In re Valley Food, LLC, 400 B R
724, holding no and collecting cases on split of authority; In re Lionel, 29 F. 3d 88
17

(2d Cir 1994); Cuyahoga, 980 F.2d 110. Does Stern v. Marshall, 130 S Ct 2594, bear
on whether a bankruptcy judge may exercise supplemental jurisdiction?
15.

DISMISSAL OF APPEAL FOR MOOTNESS ---When is a

bankruptcy appeal dismissed under the doctrine of equitable mootness?


Consider the developing test for mootness of an appeal under the equitable
mootness doctrine. See Pacifivc Lumber, 584 F.3d 229 (5 th Cir); C W Mining,
__F.3d__. 2011 WL 1474018; River Road, __F.3d__, 2011 WL 2547615;
Buchman, __F.3d__, 2011 WL 1833240; West Point, __F.3d__, 600 F.3d 231
(West Point may be contra to Crear Channel, 391 BR 25, without citing it). See
also Kuney, 2007 Norton Ann Surv of Bank L, Part 1, Art 3, p269; Airways
group, Inc. 4th Circuit, May 27th 2004. Many second Circuit cases. What policy
considerations and bankruptcy goals? In particular, See In re Metromedia Fiber
Network, Inc., 2005 WL 1693838 (2d Cir. 2005). See also, In re PC Liquidation, 2008
WL 314189 (EDNY); In re Paige, 10th Cir, 2009. Also, consider the standard for
entertaining an appeal from an unstayed sale order as a good faith challenge within
section 363(m). See 445 F.3d 935 (sale to insider was in good faith under the facts
of the case). Consider also section 364(d). See also Continental Airlines, F3d (3d
Cir), which, several years after confirmation, addressed on the merits an appeal
from a provision of an unstayed confirmation order releasing directors and officers.
16.

CHAPTER 11 PLAN'S RELEASE OF DIRECTORS and

OFFICERS ---Consider the enforceability of release provisions in favor of a


debtor's officer and directors and related injunction provisions set forth in a
confirmed chapter 11 plan of reorganization. In re Airadigm Communications, 519
F.3d 640, 655-58 (7th Cir. 2008) has an extensive discussion and holds that the test
is whether the release is "appropriate." That topic is discussed in one of the
sections of the opinion in Exide Technologies, 303 B.R. 48 (Bankr. Delaware
2003); In re Chemtura, 439 B R 561, 610 (Bankr SDNY 2010 See also Dow Corning on
remand 287 B.R. 396 and PWS, 303 F. 3d. 308(3d Cir. 2002). See also Dow Corning 280
F.3d 648, Drexel Burnham, 960 F.3d 285, A.H. Robbins Co., 880 F.2d 694, Lowenschuss,
18

67 F.3d 1394, Zale Corp., 62 F.3d 746, Western Real Estate Fund, 922 F.2d 592 (modify
on other grounds 932 F.2d 898), Continental Airlines, 203 F.3d 203, 214. See also
Brubaker, Bankruptcy Injunctions and Complex Litigation: A Critical Reappraisal of
Non-Debtor Releases in Chapter 11 Reorganizations, 1997 University of Illinois Law
Review 959. See also Metromedia Fiber Network, Inc.,416 F3d 136 2d Cir. 2005); and In
re Washington Mutual, , 2011 WL 57111 (Bankr. D Del January 7, 2011). See Professor
Brubaker's article in Bankruptcy Law Letter issue in or about 2005; and Bussel & Klee,
Recalibrating Consent, 83 Am Bankr L J 663 at 725. Also, consider the impact of In re
Johns Manville, 517 F.3d 52 (2d Cir 2008), appeal pending in S Ct , argued 3/31/09.
May a debtors duty to indemnify or to contribute to a third party be a basis for
bankruptcy jurisdiction to enjoin actions by injured persons against such third party. See
In re FairPoint, 452 BR 21 (SDNY 2011), discussing the 2d Circuits decision on remand
in Manville III. See also In re Grace, 591 F.3d 164 (3d Cir); and in re Camp Arrowhead,
451 BR 678, at 697-702. (Bankr. W D Tex 2011). Also, consider any Stern v Marshall
implication

17. RECHARACTERIZATION OF DEBT TO EQUITY --What is the test


for recharacterizing debt so as to be treated as equity. See Lothian Oil, __F.3d__, 2011
WL 3473354 (5th Cir 2011, per CJ Edith Jones). Consider the distinction between
recharacterization and equitable subordination. See Hedgd Development 389 F. 3d 1292
(10th Cir. 2004) ; Submicron, 432 F.3d 448 (3d Cir 2006); Bunch, 327 BR 389, 408
(listing factors); Roth Steel, 800 F2d 625; Cohen, 432 F3d 448; Fairchild, 453 F3d
225. See also article in 2004 edition of the Annual Survey of Bankruptcy Law. Also.
determine the test for whether an arrangement constitutes a true lease or a
disguised financing (or some other) arrangement. See United, 322 BR 335, and also
19

347, and on appeal 416 F3d 609 (7th cir 2005); US Bank, 2005 WL 563214; Bank of
NJ, 2005 WL 670528; Grubs, 319 BR 698. The court was negative on using a multi-

factor test in In re SubMicron, 432 F.3d 448, 456 (3d Cir 2006); similar view in 3rd
Cir opinion in Owens corning, 419 F 3d 195, 2010-2011; Highland, __BR__, 2011
WL 3348223 (Bankr D Del); Friedmans Leasing, 452 BR 512 (Bankr D Del 2011).
Also , consider whether there are any considerations based on Stern v Marshall, 130
S Ct 2594 (2011).
17B MITIGATION DUTY UPON REJECTION: Consider whether a
lessor has a duty to mitigate rejection damages on rejection of a real property lease
and a personal property lease, and whether state law of mitigation is relevant. See Giant
Eagle v. Phar-Mor, Inc., 528 F.3d 455 (6th Cir 2008), cert den 2009.

18.

Make whole, No call and Prepayment provisions.

Although debtor are not compelled to honor such provisions, will damage claims
be allowed where the debtor has breached such provision? Cases are split. See,
Chemtura, 439 BR 561, 596 (Bankr SDNY 2010); Calpine, 365 BR 392, and on
appeal, 2010 US Lexis 96792; Solutia, 379 BR 473; Premier Entertainment, 2010
Bankr Lexis 2994. Is the wording of the applicable instrument controlling?
21. DISCHARGE OF WILFUL INJURY CLAIM ---For a
debt to be for a willful and malicious injury so as to be non-dischargeable, must
the debtor have acted deliberately and intentionally to injure a person, or is it
enough if the debtor tended to do the act that to the injury. See Markowitz, 190 F. 3d
455 (6th Cir. 1999); Moore, 357 F.3d 1125 (10 Cir. 2004) analyzing Geiger, 118
S.Ct. 974 (1998); Dincan, 448 F3d 725. Consider In re Bucci (circuit 2007 or 2008,
cert denied 2009) on whether an ERISA trustee is a fiduciary within the meaning of
523(A(4)'s exception from the discharge there may be a circuit conflict.
22. TRADE SECRETS/BUSINESS RELATIONS Does
20

misappropriation of an employers trade secrets or interference with its


business relations constitute a nondischargeable debt for a wilfula and
malaicious injury to another entity otr property within the meaning of section
523(a)(6). See a significant opinion in In re Livingston, 379 BR 731, revd by
422 BR 645; In re Sariff, 242 BR 620. Check for a 2011 opinion in In re Lange
by BJ Hughs (Bankr. W D Mich)
23A . SCOPE OF THE ATTORNEY-CLIENT PRIVILEGE IN BANKRUPTCY.
See Code sec 344, and In re Hardwood P-G, Inc., BR (Bankr W D Tex 4/10/09)

23B . ASSIGNMENT FREE OF USE AND OTHER RESTRICTIONS --Can a chapter 11 debtor-tenant assign a shopping center lease without incorporating
the use restrictions of the lease? Consider conflicting provisions in section
365(b)(3)(c) and 365(f)(1). See In re Trak Auto, 4th Cir. April 22, 2004. In that
connection, cover whether contracts or leases may be assigned but with provisions of
no value to the non-debtor party excised.

23C. FEE SPLITTING AND SHARING. What constitutes impermissible fee


splitting under section 504, and when is fee sharing permissible in bankruptcy cases. See
In re Age Refining, Inc., 447 BR 786, 798 (Bankr WD Tex 2011), per BJ Leif Clark

23D. CROSS-DEFAULT PROVISIONS: If two different contracts contain "crossdefault" clauses, can the debtor assume one contract and reject the other, or, will the
rejection trigger a default that must be cured in order to assume the other contract?
Can a debtor "cherry pick" favored leases in a group while rejecting others? What are
the policy issues? What about plain language since cross default clauses are not
among the expressly prohibited ipso facto clauses? Does the potential impairment of
365 rejection rights justify ignoring the clause? What about other provisions that
practically make it difficult to exercise 365 powers? See In re Convenience, 2002
WL 230772; In re Pitt, 233 BR 837; Wheeling-Pitt, 54 BR 772; Sambos, 24 BR
755Railway Reorg, 133 BR 578; Liberty Mut, 2005 WL 1842375 (1st Cir).
21

23E. 'LOCK-UP' AGREEMENTS ---Are "lock-up" agreements permissible and


enforceable and, if so, under what circumstances? For example, a party might agree

in advance to vote for plan or the DIP might agree to propose specific plan terns (or a
DIP lender may require the DIP to propose a plan to which lender agrees). Review

different contexts - e.g. a pre-petition provision, a provision entered postpetition as a settlement of action or lease issue, a provision in agreement with court
approval such as DIP financing order. Look at bankruptcy crimes issues, solicitation
& voting issues, DIP fiduciary duty issues and court control issues.
23F. DIRECTORS AND OFFICERS PERSONAL RECORDS. Is a
director or an officer required to produce non-privileged personal financial records
relevant to a trustees avoidance proceeding? See In re Sanbrino, 441 BR 562
(Bankr W D Tex 2010), an exhaustive opinion
24. LIMITS OF POLICE POWER STAY EXCEPTION ---What is police or
regulatory power within section 362(b), and what are the limits to the police power
exception to the automatic stay? Is financial impact a critical factor? What about
governmental motivation? Does the section 525 anti- discrimination provision factor
into the analysis? See In re Go West Entertainment, Inc., (Bankr SDNY May 14,
2008). See also Mirant, 5th Cir. See also, City and County of San Francisco, 433
F.3d __. See also Bd of Governors v MCorp, 112 S Ct 459 (1991). Consider FCC v
NextWave, 123 S Ct 832 (2003).
25. ANTI-INJUNCTION AND DECLARATORY JUDGMENT ACTS
IMPACT. Consider the extent t which hose acts limit he authority of the Internal
Revenue Service to collect taxes owed by the debtor. See In re Berkebile, 54 BCD 94
(Bankr W D Penn. Feb 17, 2011

26. BANKRUPTCY CRIMES ---What is a bankruptcy crime under 18 USC 157?


Is actual intent required? The section is worded as broadly as the mail fraud and
wire fraud statutes, but does it really reach that far? Would it be a bankruptcy crime
to state that you had filed bankruptcy if that was not true?
22

27 SERIAL FILINGS: Are serial bankruptcy case filings permitted, and when
should a bankruptcy case be dismissed as an attempt to modify an earlier
confirmed plan of reorganization. See 1127(b). Cases collected in In re 1633
Broadway Mars Restaurant, Corp.,

BR

(Bankr SDNY May

22, 2008). Also, consider whether Bankr Rule 9024 is a basis to modify a
confirmation order because of unforeseen circumstances. See also Northtown
Properties,

_BR_ (Bankr EDNY, per the late BJ Duberstein.)

28. RIGHT TO JURY TRIAL IN BANKRUPTCY/ JURY TRIAL WAIVER: Is


there a right to a jury trial in a bankruptcy case? See Granfinanciera, 109 S Ct 2782 (1989);
Langenkamp, 111 S Ct 330 (1990). See also Braunstein v McCabe, 571 F.3d 108 (1st Cir.
2009) (no 7th amendment jury trial right in a section 543 turnover proceeding). Does the
filing of a proof claim always effect a waiver of the right to a jury trial See In re
WorldCom, Inc (Bankr SDNY December 7, 2007, and cases cited therein). Also,

consider whether filing a proof of claim waives the right to trial by jury as to a
claim that is not within the "claims allowance process," as discussed in
Connecticut Natl Bank v. Germain, 2d Cir., and also the test for whether a claim is
outside that process. The claims allowance process is discussed in Supreme Court
opinions.
29. DISCHARGE OF CLAIMS OF "KNOWN CREDITORS" Analyze who is a
"known creditor" and thus bound by the discharge injunction, and the rights of
"known creditors" and "unknown creditors." See In re Arch Wireless, Inc., 534 F.3d
76 (1st Cir 2008). See also, Grumman Olson v. Frederico, 2012 WL 1038672 (SDNY
March 29, 2012) and Wright v Owens Corning, 2012 WL 1759992 (3d Cir. May 18,
2012.
30. REOPENING BANKRUPTCY AUCTIONS. May a bankruptcy
auction be reopened to consider accepting a higher bid? See In re Bigler, 2010
23

WL 5173846 (Bankr S D Tex.) collects and reviews cases.

31A. The Business Judgment Rule In determining whether to authorize action


by a debtor, does the bankruptcy court exercise its own business judgment, or is it
guided by the debtors business judgment? See In re Park Avenue Garage, LLC,
2010 WL 5071879 (2d Cir.)
31B. SETTLEMENT STANDARD AND ISSUES: Standard for approval of a
settlement: Is approval based on the Trustee's or DIP's business judgment, or the best
interests of creditors? For detailed discussions of Rule 9019(a) and settlement
standard, see In re Dalen, 259 BR 586 and In re Novak, 383 BR 660 (BJ Jeff
Hughes). See also In re Applied Theory Corporation, _BR (Bankr SDNY April 24,
2008). See discussion of the "sound business purpose" test in In re Congoleum Corp.,
_BR 2007 WL 1428477(Bankr. D NJ). Does the test of In re Lionel (1984) apply to
settlements if the settlement provides for the use or transfer of property of the
estate.? If a creditors committee is authorized to bring a suit against a nondebtor, may
the debtor initiate a settlement of the suit, move for approval of a settlement reached
by the debtor with the defendants, and obtain approval over the objection of the
committee (assuming that the standard for a settlement is otherwise satisfied)?
See also topic No. 33 infra, which may be combined with this No 31B

31C. WHO OWNS THE CLAIM: THE ESTATE OR NON- DEBTORS: Once a
bankruptcy case is commenced, claims owned by creditors often may be asserted
only by the trustee or DIP, unless the creditors have an independent injury. The test
is often confused, See In re Seven Seas, _F3d_, 2008 WL 836400 (5th Cir.). In re
Teknek, F3d , 2009 WL 1139333 (7th Cir April 29, 2009, analyses the trustee's sole
right to assert "general claims" and a creditor's right to assert "personal claims." See
In re Teknek, 563 F3d 639,645-46 (7th Cir. 2009). What is the tgest for whether a
claim may be asserted by the trustee or by creditors or securityholders indiviually?
See Ahcom, Ltd v. Smeding, 623 F3d 1248 (9 th Cir 2010). See cases hlod that a
24

15

credior ,may assert a claim only if the creditors suffered particularized injury, and
if not, then such a claim may be asserted only by the trustee.
Where securityholders bring securities law claims against directors and
officers, do they assert their own claims or are they improperly asserting claims
that may only be asserted by the trustee? If individual claims of the security
holders, frequently asserted in class actions, does confirmation discharge such
claims?
See also a SDNY decision in Enron, reversing the B Ct, holding that Enron's
shareholders, who were to receive shares of another corporation in a pre-petition
aborted merger, had their own claims.. See also, Official Committee v. Halifax Fund,
493 F.3d 82 (2d Cir. 2007) (Creditors did not own independent claim to pursue
equitable subordination - such claims were derivative of the debtor, not direct.).
Regarding who owns misrepresentation claims against directors and officers, see
Torch, Liquidating Trust, 561 F.3d 377 (5th Cir. 2009). Also consider the general
requirements for standing to sue.
31D. RELIEF FROM A MISTAKE: Should a bankruptcy
court grant relief by permitting suit against another party after the statute of
limitations has run where the wrong party was mistakenly first sued in a timely
suit? See Global Crossing, BR , (Bankr SDNY , April 8, interpreting F R Civ P
15(c)(incorporated by BR 7015) and distinguishing earlier case law. Also consider
the extent to which relief may be granted pursuant to FR Civ P 60(b), incorporated
by BR 9024 where there has been non-compliance with a provision of the
Bankruptcy Code or of a Bankruptcy Rule. For example, whether 60(b) is a basis
for relief more than 180 days after confirmation, despite the time limit in 1144.
32.

WAIVER OF RIGHT TO FILE BANKRUPTCY ---Do

anti- bankruptcy clauses work? Can the debtor enter into a binding agreement not to
file bankruptcy, or grant an executory waiver of the automatic stay? See 195 BR
431; 184 BR 686; 160 BR 870; 108 BR 86; 189 BR 599; 167 BR 817; and
Sprayregen, November, No 5, Journal of Bankruptcy Law and Practice. Can a court

hearing a collection case enjoin the debtor from filing bankruptcy? See
25

McDonald, May 2007 ABI Journal 14 discussing Esopus Creek. (Ms McDonald

holds an LL.M. in Bankr degree). Are there any corporate or other devises that
can operate to preclude a bankruptcy filing? In connection with this topic,
consider other pre- petition waivers, such as the pre-petition waiver of the right to
reject an executory contract under 365 discussed in Trans World Airlines, 261 BR
103 (Bankr D Del 2001), and prepetition waiver of the automatic stay. See also
Bussel & Klee, Recalibrating Consent, 83 Am Bankr L J 633 at 702
33.

SETTLEMENTS - ABSOLUTE PRIORITY RULE:

Must pre- confirmation settlements comply with the absolute priority rule? See
Iridium, 478 F.3d 452; Iridium, 141 BR 13; Aweco, 725 F. 2e 293; Motorola, 478

F.2d 452. Also consider In re DBSD, 634 F.3d 79 (suggests that gifting outside
of a confirmed plan may be permissible). In order to obtain the consent of a junior
class of creditors or the equity class to a proposed plan of reorganization, it is
sometimes necessary for a class of senior creditors to reallocate (give up) to the
junior or equity class part of the plan distribution negotiated for the senior class.
This topic involves cases dealing with whether reallocation is permissible. See
World Health, Bankr. D. Del. July 7, 2006; S.P.M. Manufacturing Corp., 984 F.

2d 1305(1st Cir. 1993); Exide Technology (Bankruptcy, D. Del 2004)


rejecting reallocation; in re Union Financial Service Group, reallocation was
also discussed in Best Products, a second circuit case from about 10 years ago.
See Armstrong World and 2004 and 2009 Annual Survey of Bankruptcy Law
articles by Hollace Cohen,; and Bussel & Klee, Recalibrating Consent, 83 Am
Bankr L J 633 at 710. See also several 3rd Cir opinions
34. GOOD FAITH CHAPTER 11 FILING REQUIREMENT:
Is there a good faith requirement to file in chapter 11, and should a chapter 11 case
be dismissed for a lack of good faith? Should stay relief or a dismissal of the
bankruptcy case be granted for "cause" on the basis that the filing of the case
was in bad faith? See Capital Food Corp., 490 F.3d 21 (1st Cir 2007) and
Premier Automotive, 492 F.3d 274 (4th Cir 2007). See also decisions by the 3rd

26

Circuit on litigation tactic as not being a chapter 11 purpose, and thus not for a
chapter 11 purpose. Does In re 68 West 127th Street LLC, 285 BR 838 (Bankr
SDNY) adopt a more meaningful standard for dismissal of single asset real
estate cases that is different than a lack of good faith, and is geared to whether
there is a chapter 11 purpose for the case?
35. REQUIREMENT OF "GOOD FAITH" IN
PROPOSING A CHAPTER 11 PLAN. What is the meaning and scope of
section 1129(a)(3). Dee In re Kane, 843 F.2d 636. See also In re Quigley Co.,
53 BCD 170 (Bankr SDNY Sept 8, 2010); In re Chemtura, 439 B R 531, 591
(Bankr. SDNY 2010)
36A. ALLOWANCE OF PUNITIVE DAMAGES: Are punitive damages
allowed as a claim in chapter 11 ? Consider Hillsborough, 247 BR 510; and
Genisis, 266 BR 591. See also Supreme Court's 2007 decision in Philip Morris v.

Wills.
37.

"GOLDEN PARACHUTE" GENERAL CLAIMS ---May pre-

petition"Golden Parachute" claims be allowed as general unsecured claims in a


bankruptcy case? May the bankruptcy court authorize a post-petition golden
parachute as a general unsecured claim. If so, what is the test for allowance or
disallowance? Is "benefit to the estate" a condition to allowance of such a
claim?. In the plan confirmation setting, see Bush Industries, B. R. (Bankr
WDNY 2004).

38.

SUBSTANTIVE CONSOLIDATION TEST ---Analyse

the current test for substantive consolidation. See Owens Corning, 3rd Cir. 2005 and
District Court. See in re World Access, Inc., restating the East Group test 934 F. 2d
245. (In writing on this topic, assume that the bankruptcy court has the power to order
substantive consolidation.) For a new look at substantive consolidation, see
Cyberco Holdings, Inc., 431 BR 404 to 435 (Bankr W D Mich 2010)
27

39.

LIQUIDATION AND CHAPTER 11 DISCHARGE ---In

connection with the discharge in chapter 11 cases, when does a plan provide "for
the liquidation of all or substantially all of the property of the estate" within the
meaning of Bankruptcy Code 1141(d)(3)(A)? Is a "supervised divestiture"
different from a "wholesale liquidation"?: See Financial Security Assurance,
116 F.3d 790, 803 (5th Cir. 1997); Penn Central, 944 F.2d 164, 169 (3d Cir.
1991); River Capital, 155 B.R. 383, 387 (Bankruptcy ED Virginia 1991); First
American Health Care, 220 B.R. 720, 726 Bankruptcy St. Georgia 1998);
Mahoney, 289 B.R. 285, 303; Wood, 135 B.R. 407, 410 (Bankruptcy D.

Colorado 1989); Malone Realty, 82 B.R. 346, 349 (EDPA 1988).


40.

SCOPE OF SECTION 502(e)(1)(B) requiring the

disallowance of contingent contribution claims of a party who is co-liable on


the claim with the debtor. What is the test for whether a claim is within this
disallowance provision? This issue frequently arises with respect to contigent
environmental clean-up claims. See In re Lyondell Chemical Co., 442 B R 236
(Bankr SDNY 2011); and In re Chemtura Corp., 443 BR 601; Mark IV, 438 BR
460 (Bankr SDNY).

41.

AVOIDANCE UNDER SECTION 548(a)(1)(B):

What is the test for reasonably equivalent value in exchange for the transfer,
within the meaning of section 548(a)(1)(b)(I)? See In re TOUSA, __BR__, 444
BR 613 (S D Fla), reversd In re TOUSA, __F.3d __ (11th Circuit May 2012)

42.

PONZI SCHEMES: Are amounts paid to "investors" by a

debtor who operated a ponzi scheme recoverable in the bankruptcy case of the
person who committed the fraud? See In re Bayou, 396 B R 810 for extensive
discussion, and several Madoff and subsequent opinions
43.

KMART'S SUBSEQUENT HISTORY: The non-

statutory Rule of Necessity, developed during pre-bankruptcy law receivership


28

proceedings, has been the subject of a number of important bankruptcy cases


including Kmart. For detailed discussion, see In re Lucre, 339 B R 648, by B J
Jeff Hughes, (chapter 11 vendors and the necessity doctrine). Examine how the
courts have handled the 7th circuit's decision in Kmart on the critical vendor
problem and the doctrine of necessity. Kmart is discussed in May 2009 issue of
Norton Bankruptcy Law Adviser. What is the statutory basis for critical vendor
orders. Any relevant pre-Code case law?
45.

ABSTENTION UNDER 1334(c)(1): Should a

bankruptcy court always abstain under 28 USC 1334(c)(1) where the issue involves
a state's police and regulatory power. What is the scope of 362(b)(4)? Is the
"Younger" abstention test, as presently interpreted, relevant to the issue? See In re Go
West Entertainment, Inc., BR (Banks SDNY 2008).

47. "INSIDERS": Who is an "insider" under the non-specific (the socalled non-statutory) portion of 101(31), which begins with the word
"including"? See Lucent/Winstar (3d Circuit (2008). Consider using the arms
length test applied by the S Ct in Jones v Harris, 2010 WL 1189560

48.

ALLOWABILITY OF "SUCCESS FEES": Standard

for whether "success fees" are allowed in bankruptcy cases. Consider whether
they should be allowed, whether they should be pre-approved, and the 330 standard
to evaluate them. See Northwest Airlines, 382 BR 632.
49.

POST-PETITION INTEREST: Is the interest payable to

an oversecured creditor determined on the basis of the contract rate or in the amount
decided in the court's discretion. See In re Urban Communicators, 379 BR 232
(Bankr SDNY 2008). Does Sexton v Dreyfus, 31 S. Ct 256 (1911) provide the
answer? Also consider Ron Pair, 489 US at 24 and Rake v Wade, 508 US at 468.
See also Milham, 141 F.3d at 423, where the court stated that post-petition interest

is not based on contract, citing Ron Pair. Also, consider Till, 124 S Ct 1951 (2004)

29

53.

FIXING LIENS ---Analyze the current law on avoiding the

fixing of liens under Bankruptcy Code 522(f) and particularly the law on
impairment of exemptions. Examines whether the law has gone in a new direction
and whether its direction is compatible with the theory and goals of bankruptcy
law. See In re Brinley, 403 F.3d 415 (6th Cir. 2005).
54.
54B. DISGORGEMENT OF ADMINISTRATIVE EXPENSES ---Are
professional fees or other administrative expenses that have been paid subject to
disgorgement if the debtor becomes administratively insolvent and the claimant
received more than pro rata payment?

55.

SECURITIZED MORTGAGE CLAIMS: Who has

the right to prosecute or file a proof of claim based on a securitized mortgage


claim in bankruptcy court? See In re Hwang, 396 B R 757 Consider the
applicable UCC provisions, and also who is the "real party in interest" within the
meaning of BR 7017.

56.

SUBORDINATION OF STOCK REPURCHASE

CLAIMS --Treatment of installment stock repurchase claims based on a promise to


pay over time made when the debtor was solvent. See Merrimac Paper, 420 F3d
53 ; Lifschultz, 132 F 3d 339; Envirodine, 79 F3d 579; 12 Emory Bankr Dev J 355;
25 No. 11 Bankr Law Letter. Is such claim (a) recharacterized as equity , (b)
subordinated, or (c) treated on a parity with other general claims?
57.

ASSUMPTION OR ASSIGNMENT OF IP LICENSES

--Can a chapter 11 debtor-licensee assume or assign an intellectual property


license to a third party over the objection of the licensor? See article by Professor
.

Zinman, 38 John Marshall L Rev 97 (2004). Consider also the hypothetical vs


the actual test; Bonneville, 440 F3d 238; Adelphia, Bankr SDNY Jan 2007;
30

Footstar, 323 BR 566; Indyke, April 2007 Journal of Bankr Law and Practice 2.

See also Justice Kennedy's statement concurring in the denial of certiorari in


N.C.P. Marketing. 556 US

,March 23, 2009. See also April 2010 Journal of

Bankruptcy Law and Practice, includes an IP/bankruptcy article

58. ATTORNEY REPRESENTATION OF MULTIPLE


RELATED DEBTORS --- Is an attorney disqualified from representing
several related chapter 11 debtors which have intercompany claims or disputes,
See Adelphia, 336 BR 610 to 678, affd 2006 WL 2347807. Well written opinions,

but is there a clear test, and was the result wrong?

59.

IS NON-PAYMENT A STAY VIOLATION? ---Does

nonpayment of an amount due or other non-performance under a contract constitute a


violation of the automatic stay? See Benz, 9th Cir BAP, April 2007; In re Inslaw,
D.C. Cir.

62. SUBORDINATION ABSENT INEQUITABLE


CONDUCT --- May a bankruptcy court subordinate a claim under section 510(c)
in the absence of inequitable conduct? See Noland, 517 US 535; CF&I, 518 US 213;
Merrimack Paper, 420 F3d 53. For the purpose of section 510(c), is there a

difference between inequitable conduct of thre debtor and debtor misconduct


63. RETROACTIVE ORDERS: Does a bankruptcy court have
equitable or other authority to make an order retroactive, such as a rejection order?
See Adelphia Business Solutions, _F.3d

, (2d Cir. April 13, 2007); or a

professionals retention order, or an adequate protection order?

31

65 FIDUCIARY DUTY OF BANKRUPTCY COUNSEL. Analyze whether an


attorney in a bankruptcy case has a fiduciary duty, and to whom? Does an attorney have
a higher fiduciary duty than other fiduciaries? Does the attorneys duty run to the
court? See In re JLM, Inc., 210 B R 19, 25 (2d Cir BAP 1997); In re Teknek, 563 F.3d
639 (7th Cir. 2009). Consider the older Supreme Court cases, including Woods v City
National Bank and Mosser v Darrow

66. Ownership of the reorganized debtor by old equity New Value. Consider
new analysis in Red Mountain, 448 BR1 (Bankr D Ariz) of section 1129(b)(2)(B)(ii)s
cram-down phrase: will not receive or retain under the plan on account of such junior
claim or interest any property. Consider this in the context of a plan under which the
debtors exclusive plan-filing period has expired.
67. SECTION 546(e) SETTLEMENT DEFENSE: Revisit developments in the
scope of the securities settlement defense under section 546(e), in light of Enron,
__F.3d__, 2011 WL 2536101 and the extensive analysis of In re MacMenamins Grill,
Ltd, 2011 WL 1549056 (Bankr SDNY). This defense is commonly asserted when a
trustee or DIP brings a constructive fraud proceeding to recover amounts paid before
bankruptcy by a debtor corporation (both publicly and privately held shares) to
shareholders in redemption of their stock. Recovery is also sought from lenders who
provided the funds to pay for the corporations purchases of the shares. Is a purchase or
sale of a security required for the settlement payment defense of 542(e) to be available?
Held no in a 2-1 decision in In re Enron Creditors Recovery Trust, 651 F.3d 329 (2d Cir
2011), holding that a payment to redeem commercial paper is subject to the defense)

68. Scope of the governmental enforcement exception from the automatic stay under
32

362(b)(4). Consider Califano, 453 B R 404 (D.Nev. 2011) and cases cited in Matter of
Scott Housing Systems, 91 BR 190 in note 2 at 193, and In re Nortel, 2011 WL 1154225
(D Del)

69. MODIFICATION of a chapter 11confirmation order after substantial consumation


of the plan. Consider section 1127(b). See Northtown Realty Co., 215 BR 206 (Bankr
EDNY 1998).

70. May a mechanics lien be avoided as a constructive fraud under section 548(a)(1)(B)
or as a preference under section 547. See Desert Fire, 434 B R 716 discussing varios issues
See also, an October 2011 ABI Journal article

71. What are claims under section 101(5)(B). Determine the meaning and scope of
section 101(5)(B). Consider various equitable remedies, including whether enjoining the
breach of a non-competition agreement gives rise to a claim under section 101(5)(B).
See In re Stone Resources, inc, 2011 WL 4017925 (E D Pa.), revg bankr ct, and holding
that a pre-petition preliminary injunction is not a claim , and thus not subject to the
automatic stay

74. Scope of review by the bankruptcy court of a U S Trustees decisions, including


forming and changing committee membership, and appointment of a case trustee,
pursuant to provisions of the Bankruptcy Code

77. Section 502(c) provides for estimation of certain contingent and unliquidated claims.
Is the bankruptcy courts estimate a final determination of the claim, or may the claimant
33

proceed with litigating the claim to a final judgment? In a chapter 11 case, if the judgment
exceeds the estimate, does the claimant receive an additional distribution under the
confirmed plan at the time of distribution or even after consumation of the plan? Also,
consider 28 USC 157(b)(2)(B) providing that estimation is a core proceeding except for
certain tort claims and the impact of Stern v Marshall on the process. As to finality, see
Chateaugay, 2nd Cir, among others

79. Enforceability of pre-petition waivers of the automatic stay. See a 1993 ABI L Rev
article.

80. May a claim asserted in a bankruptcy proof of claim be disallowed on equitable


grounds. See Washington Mutual, , 2011 WL 4090757 at *44 (Bankr. D. Del.)

82. The significance of the date of commencement of the bankruptcy case in resolving
issues that arise under the Bankruptcy Code. Consider section 541. See Burgess v. Sikes,
438 F.3d 493 (5th Cir. 2006) (en banc, and strong dissent); see also Segal v Rochelle, 382
U S 375 (1966); In re Myers, 616 F.3d 626 (7th Cir 2010). This topic should track the
development of the case law since 1966.

83. Developments under section 1115 for individual debtors. See the following cases in
2010 Westlaw: Nos 1428266; 1486035; 1760282; 1753795. See also 445 BR 885; 447 BR
445; and 445 BR 816

84. Are rights of first refusal unenforceable restraints on assignment; ipso facto clauses.
34

See the following cases: 77 BR 349, 352; 359 BR 65; 61 BR 495; 190 BR 958; 139 F.3d
702; 241 BR 17; 226 BR 586; 756 F.2d 1043; 1943 BR 703; 284 BR 111; and 118 BR 432

85. The interplay of SEC receiverships and bankruptcy. See SEC v Byers, 609 F,3d 87.
Also consider any implication of section 1141(d)(6)(A), and a law review on that topic
byBilly Hilbold in ABI L Rev

89. What constitutes value for the purpose of sections 547, 548 and 550

90. Applicability and scope of the equitable doctrine on marshalling in bankruptcy


cases. See SZWYD, 444 BR 10

91. Scope of Related to jurisdiction Developments: A new look at the scope of


related to jurisdiction under 28 USC section 1334(b). See In re Hoyt, 447 BR 283, 289
(bankr D Ariz 2011) (suggests that the scope is the same as the fact-based test for
supplemental jurisdiction, rather than requiring an effect on the estate); and 446 BR 844;
447 BR 302; and 447 BR 283

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