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Involuntary Bankruptcy: A Useful Tool for Lessors and Creditors
“Bankruptcy.” To many creditors this term is understood to mean a lost cause, a write-off and the end of the collection process. To other creditors, including those that appropriately use the filing of an involuntary bankruptcy petition, bankruptcy can mean the beginning of a successful strategy. Many of the benefits leasing creditors and others derived from the filing of an involuntary bankruptcy petition against a delinquent customer under the former Bankruptcy Code are preserved in the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (“BAPCPA”), with some favorable additions. Used intelligently, and in the right situation, the filing of an involuntary bankruptcy petition can still be a useful tool.
One of the luxuries we have when discussing BAPCPA and filing involuntary petitions is that we don't have to meticulously lay out the law under the former Bankruptcy Code, as anyone filing an involuntary petition after reading this article will certainly be operating under BAPCPA, which is now the law. Under the current Bankruptcy Code, an involuntary petition may only be filed by a minimum of three creditors with debts totaling at least $12,300 in the aggregate. If the alleged debtor challenges the petition, the petitioning creditors will need to show that the debtor is unable to meets its obligations as they come due and that the creditors' claims are not contingent as to liability or the subject of a bona fide dispute as to liability or amount. If the debtor has fewer than 12 creditors, then a single creditor holding a claim of at least $12,300 can file an involuntary petition. Successfully prosecuting an involuntary petition generally means the fees and costs associated therewith are an expense to be borne by the debtor's estate, provided it has sufficient assets to do so. This right is preserved in Section 503(b)(3)(A). Congress recognized that creditors should not bear the financial burden of declaring an already delinquent customer bankrupt. However, make sure to first seek the advice of experienced counsel before filing an involuntary petition, as the court is empowered to grant judgment in favor of the debtor for its costs or attorneys' fees if the involuntary petition is filed in bad faith and ultimately dismissed. Thus, before filing an involuntary petition against an account debtor, it is vitally important to make sure the creditor(s) joining in the petition meet the requirements of Section 303(b).
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Beach Boys Songs Written Decades Ago Triggered Current Quarrel With Lawyers
There's current litigation in the ongoing Beach Boys litigation saga. A lawsuit filed in 2019 against Nevada residents Mike Love and his wife Jacquelyne in the U.S. District Court for the District of Nevada that alleges inaccurate payment by the Loves under the retainer agreement and seeks $84.5 million in damages.
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
When Is a Repair Structural or Nonstructural Under a Commercial Lease?
A common question that commercial landlords and tenants face is which of them is responsible for a repair to the subject premises. These disputes often center on whether the repair is "structural" or "nonstructural."