Published on:

case roundup 07-13-07

2nd cir

In re AppliedTheory Corp., No. 06-3390
Order affirming order of the bankruptcy court denying appellant committee of unsecured creditors authorization to assert a claim of equitable subordination under 510(c) of the Bankruptcy Code is affirmed over claim that appellant is not obligated to seek the court’s approval to bring its equitable subordination claim because In re STN Enters., 779 F.2d 901 (2d Cir. 1985), does not apply.

4th cir
Nat’l Energy & Gas Transmission, Inc. v. Liberty Elec. Power, LLC, No. 06-1459
In a suit involving the payment of a termination fee for an electricity tolling agreement on behalf of a bankrupt party to the agreement, judgment for defendant-creditor is reversed where a creditor may not allocate a payment made by a non-debtor guarantor first to interest then to principal, thus preserving the unpaid principal for collection in bankruptcy, since the allocation of a payment in this manner would permit the creditor to collect an amount otherwise disallowed as post-petition interest.

7th cir
McDougall v. Pioneer Ranch Ltd. P’Ship, No. 06-3757
In a suit by a pension fund to recover withdrawal liability from a bankrupt trucking company, summary judgment for plaintiffs is affirmed where a vacation property on which the owners of the trucking company farmed and raised cattle constituted a trade or business for purposes of the Multiemployer Pension Plan Amendments Act.

8th cir
Benn v. Cole, No. 06-2217
A decision finding that Missouri law exempts tax refunds from a debtor’s bankruptcy estate is reversed as Missouri Revised Statutes section 513.427 is not an exemption statute and there is no exemption for tax refunds under state law or applicable federal law.

10th cir

In re: Kester, No. 06-3114, 06-3116
In a bankruptcy trustee’s adversary proceeding to compel turnover of a residence held by a self-settled living revocable trust, a judgment finding that bankruptcy debtors were entitled to a state law homestead exemption despite the fact that legal title to the real property was held by the trust is affirmed pursuant to the state supreme court’s answer to a certified question regarding the applicability of the homestead statute in such circumstances.
In Re: Sweeney, No. 06-1224
In the bankruptcy context, restitution ordered pursuant to juvenile delinquency proceedings is dischargeable under 1328(a)(3).

11th cir
Advanced Telecomm. Network, Inc. v. Allen, No. 06-12187
In case involving a chapter 11 debtor seeking to recover certain transfers made before the company declared bankruptcy, order affirming bankruptcy court judgment in favor of defendants is reversed as: 1) plaintiff’s fraudulent transfer claims were not barred by the statute of limitations; and 2) bankruptcy court’s alternative holding on the merits is rejected where the court erred in its calculation of plaintiff’s solvency and the “value” plaintiff received in return for the disputed transfer.

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