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Posts published in “Bankruptcy”

5th Cir. Reverses Denial of Motion to Compel Arbitration in TILA Case

The U.S. Court of Appeals for the Fifth Circuit recently reversed the denial of a lender’s motion to compel arbitration in an adversary bankruptcy proceeding for allegedly violating the federal Truth in Lending Act (TILA), holding that -- despite conflicting clauses in two different relevant agreements -- the parties had entered into a valid arbitration agreement that delegated the threshold issue of arbitrability to the arbitrator.

2019: A Watershed Year for Consumer Financial Services Law

It has been an extraordinary 365 days for consumer financial services law. I cannot recall a year where so many states introduced legislation or proposed regulations or rules impacting the credit industry. At the federal level, proposed rules for the Fair Debt Collection Practices Act were (finally) released and California also proposed regulations under the California Consumer Privacy Act.

2019 Bankruptcy Year in Review: What We Have Seen and What to Expect in 2020

The year 2020 offers to be an interesting one for bankruptcy litigation. With several issues before the Supreme Court, at least one will have a material effect on financial services. In addition, higher credit costs will spur an increase in the number of bankruptcy filings, both on the consumer and commercial side. With the California Consumer Privacy Act taking effect on Jan. 1, it will not be long before we see issues arising from it percolating into bankruptcy cases. 

6th Cir. BAP Holds So-Called ‘910 Claims’ To Be Treated Like Other Allowed Secured Claims

The Bankruptcy Appellate Panel for the U.S. Court of Appeals for the Sixth Circuit (Sixth Circuit BAP) recently reversed a lower bankruptcy court’s ruling that rejected an objection to the confirmation of debtors’ chapter 13 plan asserted by the holder of a claim relating to vehicle financing incurred within 910 days of the bankruptcy petition (a 910 claim).

7th Cir. Reduces Punitive Damage Award Against Mortgage Servicer by Over 80%

The U.S. Court of Appeals for the Seventh Circuit recently reversed as excessive a jury’s award of $3 million in punitive damages against a mortgage servicer for inadequate recordkeeping, misapplication of payments, and poor customer service. However, the Court affirmed the jury’s award of $582,000 in compensatory damages and remanded the case to the trial court with instructions to reduce the punitive damages award to $582,000, a 1:1 ratio of compensatory to punitive damages.

3rd Cir. Holds Failure to Turn Over Collateral Repossessed Prior to Bankruptcy Does Not Violate Automatic Stay

The U.S. Court of Appeals for the Third Circuit recently held, in a case of first impression in that circuit, that a secured creditor’s failure to turn over collateral repossessed prior to the filing of the bankruptcy petition does not violate the automatic stay. A…

11th Cir. Reverses Denial of Class Cert in Challenge to Post-Discharge Mortgage Statements

In a putative class action of borrowers who received mortgage statements after a bankruptcy discharge, the U.S. Court of Appeals for the Eleventh Circuit recently reversed a trial court order denying certification for failure to establish predominance. In so ruling, the Eleventh Circuit held that…

5th Cir. Holds Bankruptcy Courts Cannot Enforce Discharge Injunctions From Other Districts

The U.S. Court of Appeals for the Fifth Circuit recently held that a bankruptcy court lacks the power to enforce discharge injunctions entered in other districts, and that the debtors’ particular private education loans were not excepted from discharge. A copy of the opinion in…

7th Cir. Holds UCC Financing Statement May Incorporate List of Collateral by Reference

The U.S. Court of Appeals for the Seventh Circuit recently reversed a bankruptcy court’s ruling that a lender failed to perfect its security interest because its UCC financing statement failed to provide sufficient indication of the secured collateral under Article 9 of the Uniform Commercial…

11th Cir. Holds No Violation of Bankruptcy Discharge for ‘Informational Statement’

The U.S. Court of Appeals for the Eleventh Circuit recently affirmed the bankruptcy court’s denial of a debtor-borrower’s motion for sanctions, which alleged that her mortgage loan servicer violated her bankruptcy discharge by mailing a communication in a purported attempt to collect upon a discharged…