Introduction to Chapter 11 Unsecured Creditors’ Committees

Official committees of unsecured creditors (Committees) serve an important function in Chapter 11 bankruptcies and can have a major influence on the outcome of any Chapter 11 case.  Committees preserve the rights of unsecured creditors and their responsibilities include (i) monitoring the progress of the case; (ii) providing input on

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“We Provide the Highest Quality Legal Services”

Many law firms say that they provide “the highest quality legal services.”  What does this really mean?  I recently watched a relatively routine hearing in a Chapter 11 case where the debtor corporation had eight – that’s right – eight lawyers in the courtroom.  One lawyer spoke, seven watched.  Because

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Financial Tips for Small Business Owners

  Keep corporate vs. personal debt separate.  It is a common practice for small business owners to experience periodic cash flow problems and turn to use of personal credit cards to infuse cash into their business.  It is important to note that debt incurred under a credit card held only

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Can I File Chapter 7 and Keep All of My Toys?

On June 28, the Bankruptcy Appellate Panel for the Sixth Circuit issued an opinion holding that Mr. and Mrs. Weixel’s Chapter 7 case was properly dismissed for “substantial abuse” under the bankruptcy laws.   In re Weixel, 13 FED App 0003P.   This case is binding on Kentucky bankruptcy courts. The Weixels were not

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New Case Discusses IRA Exemptions

In a case decided on June 17, the Sixth Circuit Court of Appeals reversed the Tennessee Bankruptcy Court and US District Court regarding the continuing exemption of funds in an IRA account.  In In re Daley, the chapter 7 trustee argued that because the IRA account agreement contained boilerplate language granting

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Sixth Circuit Discusses Non-Dischargeability Issues on Assigned Debt

In a case issued on June 10, the Sixth Circuit Court of Appeals in In Re Pavdvierz discussed at some length concerns that arise when the creditor pursuing a nondischargeability  action is an “assignee” from the original creditor.  Sixth Circuit cases are binding on our local bankruptcy judges.  In Pavdvierz, the Court found

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Credit Cards and Bankruptcy

If you are contemplating filing bankruptcy and have credit cards, please consider the following: Don’t pay off your credit card balances before filing.   Credit card debt is typically dischargeable in bankruptcy provided you don’t take cash advances or purchase luxury goods before filing for bankruptcy relief.  It does not make

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Preparing for Your Meeting of Creditors

Within a few days of filing your bankruptcy petition, the bankruptcy court will schedule your “first meeting of creditors,” which is often referred to as a “341 hearing.”  Your bankruptcy trustee (not the bankruptcy judge) will preside over the meeting of creditors, and you will be required to testify under

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Number 2 Pet Peeve

Before every deposition of a client, I advise the witness to always answer deposition questions truthfully in as few words as possible. If a question can be answered “yes” or “no,” then that’s the preferred response. If the client does not know the answer to a question, the answer is

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