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2008 NORTON BANKRUPTCY LAW SEMINAR MATERIALS

Appellate Court Decisions Related
To Bankruptcy Cases

By William Norton, III

8. 109(e) Eligibility - Chapter 13

In re Glance, 487 F.3d 317 (6th Cir. June 1, 2007) (Bankruptcy court properly dismissed Chapter 13 petition where mortgage liens exceeded debt limit found in S 109(e). Even though debtor did not sign the notes secured by the mortgage liens, he consented to the liens and would have been required to satisfy them if he wanted to sell the properties.)

9. 110 Bankruptcy Petition Preparers

Frankfort Digital Svcs., Ltd. v. Kistler (In re Reynoso), 477 F.3d 1117 (9th Cir. Feb. 27, 2007) (Company that sold web-based software that prepares bankruptcy petitions was a "bankruptcy petition preparer" subject to penalties for violating S 110.)

10. 303 Involuntary Petition -- Burden of Proof

DeBold v. Case, 452 F.3d 756 (8th Cir. June 26, 2006) (In dispute as to the ownership of property in an involuntary Chapter 7 case, trustee had initial burden of proving that property belonged to the estate.

11. 303(c) Involuntary Petition - Right to Join

In re DSC, Ltd., 486 F.3d 940 (6th Cir. May 23, 2007) (Section 303(c) does not grant petitioning creditors the absolute right to join an involuntary case. Since an insufficient number of qualified creditors joined in the initial involuntary petition and subsequent petitioning creditors did not meet the bankruptcy court's deadline for joining, the bankruptcy court did not err in dismissing the involuntary petition.)

12. 303(i) Involuntary Petitions -- Damages

In re John Richards Homes Bldg. Co., LLC, 439 F.3d 248 (6th Cir. Mar. 1, 2006) (Bankruptcy court did not err in awarding costs, attorneys' fees, compensatory damages and punitive damages totaling $6.4 million pursuant to S 303(i) based on bad faith filing of involuntary petition. The evidence of bad faith included that the petitioning creditor knew or should have known that his claim was disputed, intended to cause the debtor harm and did not know how the amount of the debt allegedly owed him was calculated.)

13. 304 Foreign Proceeding

Banka A.D., Beograd v. Superintendent of Banks (In re Deposit Ins.

 

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