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Summary judgment for a bankruptcy trustee allowing the invocation of the “strong-arm” provision against an unrecorded, unperfected security interest in the chapter 11 debtor’s assets is affirmed

1st circuit

In Re: Millivision, Inc. (01/16/07 – No. 06-9006)

Summary judgment for a bankruptcy trustee allowing the invocation of the “strong-arm” provision against an unrecorded, unperfected security interest in the chapter 11 debtor’s assets is affirmed where: 1) the appellants’ argument that Bankruptcy Code sections 547(c) and (e) are exceptions to section 544(b)’s avoidance provisions was foreclosed, since sections 547(c) and (e) do not constitute “generally applicable [relation-back] law”; 2) the bankruptcy court appropriately rejected appellant’s argument that the involuntary chapter 11 case did not “commence” on December 12, but on January 21, 2004, once an order for relief had been entered; and 3) appellants’ lack of diligence in recording their interest precluded equitable relief.

In Re: Olympic Mills Corp. (01/17/07 – No. 05-9012)

Bankruptcy Appellate Panel decision subjecting defendant-appellant to over $3 million in liability for retaining loan payments in breach of trust is affirmed where: 1) the unambiguous language of the subordination agreement in question covered loans made after the execution of the agreement; 2) defendant cannot support an argument for equitable estoppel without a showing that he was induced to rely on plaintiff’s representations; and 3) defendant waived his argument that the bankruptcy court’s award did not accurately reflect expectation damages.

2nd circuit

In Re: Johns-Manville Corp. (01/17/07 – No. 06-2320)

Motion to dismiss cross-appeal in No.06-2320-bk is granted as, whether or not the time limit for a cross-appeal is jurisdictional, the time limit must be enforced when it is properly invoked by an adverse party. Denial of motion to extend time to file notice of appeal in Case No. 06-3317-bk is affirmed as, under the strict standard governing “excusable neglect,” the district court acted within its discretion in denying the motion for an extension of time to appeal.

4th circuit

Murphy v. O’Donnell (01/18/07 – No. 05-1637, 05-1844)

Granting of motion to modify confirmed Chapter 13 plan in one case, but denial of modification in second case, are affirmed where: 1) in case of denial, although the debtors’ residence appreciated in value post-confirmation, debtors’ earned income had been reduced and they did not experience a substantial change in their financial condition, thus the doctrine of res judicata prevents modification of the debtors’ confirmed plan; and 2) in case of modification, the debtor did experience a substantial and unanticipated change in his post-confirmation financial condition, and res judicata does not prevent the modification of his confirmed plan.

9th circuit

Stanley v. Gonzales (01/16/07 – No. 04-17147)

In a suit challenging the Attorney General’s removal of plaintiff from her position as a United States Trustee as a violation of the separation of powers doctrine, the Appointments Clause, and her right to procedural due process, dismissal of the suit is affirmed on alternate grounds where none of the trustee’s constitutional claims presented even colorable arguments.

In re: Pomona Valley Med. Group, Inc. (01/17/07 – No. 04-56334)

An order rejecting physician’s contract with bankruptcy debtor-independent practice association and an order dismissing his complaint in an adversary proceeding against debtor are affirmed in part, but reversed in part where the bankruptcy court erred in: 1) dismissing a retaliation claim under Federal Rule of Bankruptcy Procedure 7012; and 2) dismissing a cause of action alleging unfair competition.

10th circuit

Holdeman v. Devine (01/17/07 – No. 05-4302)

In a class action suit brought by participants in an ERISA-governed medical benefit plan who were left with significant medical bills when their employer failed to properly fund the plan and filed for bankruptcy, summary judgment for defendant, who simultaneously served as an officer of the employer and as a plan fiduciary, is affirmed in part as the district court properly concluded that defendant’s decisions regarding plan-funding were purely business decisions that did not implicate his fiduciary duties to the plan. The judgment is reversed in part due to the district court’s failure to properly address certain issues.

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