Law Commons^™

Debts Based On Fraudulent Misrepresentations Of Material Fact May Not Be Discharged Under § 523(A)(2)(A), Lauren Shoemaker

Bankruptcy Research Library

(Excerpt)

In general, title 11 of the United States Code (the “Bankruptcy Code”) provides that an individual may be discharged of his or her debts at the conclusion of his or her bankruptcy case. A discharge relieves a debtor from liability for its unpaid pre-petition debts and acts as an injunction, barring a creditor from collecting such debts from the debtor. However, under section 523(a)(2)(A) of the Bankruptcy Code, an individual debtor cannot be discharged from any debt for money obtained by “false pretenses, a false representation, or actual fraud.”

This article explores when debtors cannot be discharged of their …

Debtor Needs To Have Benefitted From Fraud To Be Barred A Discharge Under 11 U.S.C. § 523(A)(2)(A), Elizabeth Tighe

Bankruptcy Research Library

(Excerpt)

Title 11 of the United States Code (the “Bankruptcy Code”) provides that a court may grant a debtor a discharge of its debts, subject to certain conditions and exceptions. One exception to dischargeability is set forth in section 523(a)(2)(A), which bars a discharge from debt “for money, property, services, or an extension, renewal, or refinancing of credit, to the extent obtained by . . . false pretenses, a false representation, or actual fraud, other than a statement respecting the debtor's or an insider's financial condition.”

A key phrase in the statute is “obtained by” and courts have applied a …

Lifting The Automatic Stay After Foreclosures In New York, Andrew Vavricka

Bankruptcy Research Library

(Excerpt)

The filing of a bankruptcy petition under title 11 of the United States Code (the “Bankruptcy Code”) results in an automatic stay that bars collection efforts against a debtor’s property. Consequently, a creditor will generally be prevented from foreclosing on property in which a debtor has an interest, including a possessory interest. Section 362(d), however, provides that the automatic stay may be lifted or modified under four alternatives. This article will discuss the implication of the automatic stay on a New York foreclosure action and bankruptcy courts’ rationale for lifting the automatic stay in the foreclosure context.

Part I …

Covid-19 & The Warn Act During A Bankruptcy Case, Audrey Victor

Bankruptcy Research Library

(Excerpt)

The Worker Adjustment and Retraining Notification Act (“WARN Act”) provides that “an employer shall not order a plant closing or mass layoff until the end of a 60-day period after the employer serves written notice of such order to each impacted employee.” Under the WARN Act, a plant closing is “permanent or temporary shutdown of a single site of employment, or one or more facilities or operating units within a single site of employment….” A mass layoff is “a reduction in force which…(a) is not the result of the plant closing; and (b) results in an employment loss at …

Of Systems Thinking And Straw Men, Kate Klonick

Faculty Publications

(Excerpt)

In Content Moderation as Systems Thinking, Professor Evelyn Douek, as the title suggests, endorses an approach to the people, rules, and processes governing online speech as one not of anecdote and doctrine but of systems thinking. She constructs this concept as a novel and superior understanding of the problems of online-speech governance as compared to those existent in what she calls the “standard [scholarly] picture of content moderation.” This standard picture of content moderation — which is roughly five years old — is “outdated and incomplete,” she argues. It is preoccupied with anecdotal, high-profile adjudications in which platforms …

Get Out: Structural Racism And Academic Terror, Renee Nicole Allen

Faculty Publications

Released in 2017, Jordan Peele’s critically acclaimed film Get Out explores the horrors of racism. The film’s plot involves the murder and appropriation of Black bodies for the benefit of wealthy, white people. After luring Black people to their country home, a white family uses hypnosis to paralyze victims and send them to the Sunken Place where screams go unheard. Black bodies are auctioned off to the highest bidder; the winner’s brain is transplanted into the prized Black body. Black victims are rendered passengers in their own bodies so that white inhabitants can obtain physical advantages and immortality.

Like Get …

Didn’T I Cover That In Class? Low-Stakes Technique Of Quizzing To The Rescue, Robin A. Boyle

Faculty Publications

(Excerpt)

We all have had those moments when students’ papers do not reflect an important lesson covered in class. For instance, if teaching persuasive writing, you have likely instructed your students to use a full sentence for their point headings in their briefs, only to find phrases where sentences should have been used. Consequently, you find yourself making the same written comments on papers or verbal comments in conferences with students, beginning with, “As I had instructed in class…” In his groundbreaking book, Experiential Learning, researcher and theorist David Kolb introduced the concept of “deep learning,” which can remedy …

High Anxiety: Racism, The Law, And Legal Education, Elayne E. Greenberg

Faculty Publications

Conspicuously absent from the United States’ ongoing discourse about its racist history is a more honest discussion about the individual and personal stressors that are evoked in people when they talk about racism. What if they got it wrong? The fear of being cancelled - the public shaming for remarks that are deemed racist - has had a chilling effect on having meaningful conversations about racism. What lost opportunities!

This paper moves this discussion into the law school context. How might law schools rethink their law school curricula to more accurately represent the role systemic racism has played in shaping …

Human Trafficking, Cults, & Coercion: The Use Of Drugs As A Tool, Robin Boyle Laisure

Faculty Publications

Thanks to the successful prosecution of sex traffickers, the definition and proof of “coercion” now encompasses evidence showing the use of addictive drugs as a tool. This article describes two case examples, and in both, the perpetrators supplied abundant amounts of addictive substantives. Once those victims became addicted and feared the pain of withdrawal, the sex traffickers forced the victims to perform commercial sex acts to pay off the drug debt they incurred, feeding the addiction the traffickers caused. Coercion by way of intentional drug addiction and control is a theory that expands the operative word “coercion.” This short article …

Mysterizing Religion, Marc O. Degirolami

Faculty Publications

(Excerpt)

A mystery of faith is a truth of religion that escapes human understanding. The mysteries of religion are not truths that human beings happen not to know, or truths that they could know with sufficient study and application, but instead truths that they cannot know in the nature of things. In the Letter to the Colossians, St. Paul writes that as a Christian apostle, his holy office is to “bring to completion for you the word of God, the mystery hidden from ages and from generations past.” Note that Paul does not say that his task is to make …

The Exit Theory Of Judicial Appraisal, William J. Carney, Keith Sharfman

Faculty Publications

For many years, we and other commentators have observed the problem with allowing judges wide discretion to fashion appraisal awards to dissenting shareholders based on widely divergent, expert valuation evidence submitted by the litigating parties. The results of this discretionary approach to valuation have been to make appraisal litigation less predictable and therefore more costly and likely. While this has been beneficial to professionals who profit from corporate valuation litigation, it has been harmful to shareholders, making deals costlier and less likely to be completed.

In this Article, we propose to end the problem of discretionary judicial valuation by tracing …

The Empty Promise Of The Fourth Amendment In The Family Regulation System, Anna Arons

Faculty Publications

Each year, state agents search the homes of hundreds of thousands of families across the United States under the auspices of the family regulation system. Through these searches—required elements of investigations into allegations of child maltreatment in virtually every jurisdiction—state agents invade the home, the most protected space in Fourth Amendment jurisprudence. Accordingly, federal courts agree that the Fourth Amendment’s warrant requirement applies to family regulation home searches. But almost universally, the abstract recognition of Fourth Amendment protections runs up against a concrete expectation on the ground that state actors should have easy and expansive access to families’ homes. Legislatures …

Hats For Sale: Efficiency, Economics, And Process Integrity, Elayne E. Greenberg

Faculty Publications

(Excerpt)

What are the ethical considerations for a mediator when a neutral is asked to be both the mediator and arbitrator on the same case? Some parties and their lawyers opt to select one neutral to serve as both the mediator and arbitrator on the same case, believing it will be a more efficient and cost-effective way to resolve their dispute. After all, the mediator already knows the facts of the case. Why waste time and money getting another neutral up to speed? This design choice, however, may collide with the mediator ethical mandates of party self-determination, neutral impartiality, confidentiality, …

Humanizing Virtual Dispute Resolution, Elayne E. Greenberg

Faculty Publications

(Excerpt)

How might neutrals and advocates foster interpersonal dynamics when conducting arbitrations and mediations virtually, consistent with the ethical obligations of each profession and the ethical underpinnings of each process?

Virtual dispute resolution for commercial dispute resolution has become the new normal. Yet, the dispute resolution listserves are still peppered with posts from mediators and arbitrators who, although publicly extolling their own commitments to their impartiality and neutrality, are also simultaneously voicing their strong preferences for conducting their dispute resolution processes in person. According to these neutrals, they are unable to attain the same results when the process is conducted …

Copyright’S Capacity Gap, Andrew Gilden, Eva E. Subotnik

Faculty Publications

Most areas of law require that individuals meet a certain threshold of capacity before their decisions — e.g., to marry, to enter into a contract, or to execute an estate plan — are given legal effect. Copyright law, by contrast, gives legal effect to creative decisions by granting the decisionmaker many decades of exclusive rights so long as they are a human being and have demonstrated a “creative spark.” This Article examines the overlooked consequences of this gap in capacity standards between copyright and other areas of law. It shows that this gap has produced numerous opportunities for vulnerable creators …

Integration & Transformation: Incorporating Critical Information Literacy And Critical Legal Research Into Advanced Legal Research Instruction, Courtney Selby

Faculty Publications

(Excerpt)

Legal research is not a separate and distinct endeavor from legal analysis and advocacy. These activities are inextricably intertwined in the practice of law. Few would suggest that advocacy includes the process of applying rules to situations in a vacuum without reference to context and consequences. Yet we often see this assumption about the legal research process. Many students presume that conducting legal research is a neutral endeavor, and that when done properly, it delivers the universe of relevant authorities to the researcher. This essay is about my experience integrating critical perspectives into an existing advanced legal research course …

Swimming With Broad Strokes: Publishing And Presenting Beyond The Lw Discipline, Robin Boyle Laisure, Stephen Paskey

Faculty Publications

(Excerpt)

In our greater skills community, we share ideas, borrow and tweak theories from other disciplines, and create new approaches. It is understandable how our community may expand pedagogy to the brim of legal writing or explore topics outside of the field. Skills professors are, by nature, a creative collective who teach from the heart and enjoy writing and thinking. Our publishing pursuits can be boundless.

Both Authors of this Article share mutual experiences of dipping our toes in a pond beyond the legal writing continent. Our writing experiences have influenced our teaching, bringing these broader perspectives to our legal …

The Effect Of Insider Status On The Court's Approval Of A Key Employee Retention Plan, Perry Chresomales

Bankruptcy Research Library

(Excerpt)

When a company that has filed for relief under chapter 11 of title 11 of the United States Code (the "Bankruptcy Code") seeks to retain essential employees through the course of its bankruptcy, the payments made with the goal of retaining key employees are subject to the requirements of section 503(c) of the Bankruptcy Code. These payment plans, also known as Key Employee Retention Plans or "KERPs", are designed to "provide certain Key Employees with a financial incentive to forgo seeking alternative employment during the Debtors' bankruptcy proceeding as well as after confirmation of a chapter 11 plan." In …

A Hotel Does Not Meet The Definition Of "Single Asset Real Estate" And May Reorganize Under Subchapter V Of Chapter 11 Of The Bankruptcy Code, Patrick Canavan

Bankruptcy Research Library

(Excerpt)

Enacted via the Small Business Reorganization Act ("SBRA") in 2019, Subchapter V streamlines the reorganization process, allowing small business debtors to file bankruptcy in a timely and cost-effective manner. The goal behind the legislation is to encourage reorganizations, which will generally result in creditors receiving a higher distribution than in a liquidation and more small businesses surviving. Section 1182(1) of title 11 of the United States Code (the "Bankruptcy Code") limits those who can file a Subchapter V case to a "small business debtor" who does not own a "single asset real estate" project ("SARE"). Thus, if the debtor …

Courts Apply A Case-By-Case Analysis In Distinguishing A Meritorious Motion To Disqualify From A Delaying Litigation Tactic, Cathrena Collins

Bankruptcy Research Library

(Excerpt)

It is becoming increasingly rare for an attorney to remain at the same firm for an entire career. Lateral movements of lawyers coupled with large firms employing hundreds of attorneys creates ample opportunity for conflicts of interest to arise. The American Bar Association explains a conflict of interest is present when "there is a significant risk that a lawyer's ability to consider, recommend or carry out an appropriate course of action for the client will be materially limited as a result of the other lawyer's responsibilities or interest." Furthermore, Rule 1.10(b) dictates that a lawyer joining a new firm …

The Various Methods Circuit Courts Use To Define "Initial Transferee" In Fraudulent Transfers, Anthony J. Crasto

Bankruptcy Research Library

(Excerpt)

Transfers of a debtor's interest or obligation in property to a third party, made to prevent creditors from reaching assets in a bankruptcy case, are known as fraudulent transfers. Under current law, there are two types of fraudulent transfers: actual fraud and constructive fraud. Actual fraud requires findings of a debtor's "intent to hinder, delay, or defraud any entity to which the debtor was or became, on or after the date that such transfer was made or such obligation was incurred, indebted." Constructive fraud does not require a finding of intent and occurs when a debtor receives "less than …

The Barton Doctrine's Applicability To Suits Against Bankruptcy Trustees When The Bankruptcy Court Lacks Jurisdiction Over The Matter, Chelsea Frankel

Bankruptcy Research Library

(Excerpt)

In Barton v. Barbour, the Supreme Court established the general rule that a lawsuit cannot be brought against a receiver for acts done within their authority without leave of the court that appointed such receiver. The Court precluded a personal injury suit against a company's receiver without leave of the appointing court, finding that if the plaintiff were permitted to recover on his personal injury claim against the receiver, he would be recovering from the receivership property "without regard to the rights of other creditors or the orders of the court which is administering the trust property." The …

Chapter 15 Recognition Is Necessary For Efficient And Consistent Cross-Border Proceedings, Sarah Franzetti

Bankruptcy Research Library

(Excerpt)

When Chapter 15 of title 11 of the United States Code (the "Bankruptcy Code") was adopted in 2005, it repealed the former section 304, which had often led to ad-hoc and inconsistent rulings for foreign debtors seeking assistance in U.S. bankruptcy courts. The new Chapter was passed to achieve greater efficiency on a domestic scale, as well as the "fair and efficient administration of cross-border insolvencies" by promoting greater cooperation between U.S. and foreign courts. For a foreign debtor to reap the benefits of this cooperation, a representative of the foreign bankruptcy proceeding must petition a U.S. bankruptcy court …

Erisa Withdrawal Liability Claims Unlikely To Receive Administrative Expense Priority Status In A Chapter 11 Reorganization, Bridget Golden

Bankruptcy Research Library

(Excerpt)

An employer who withdraws their participation in a multi-employer defined benefits plan is statutorily required to pay the plan a withdrawal liability. Employee Retirement Income Security Act of 1974 ("ERISA"), as amended by the Multiemployer Pension Plan Amendments Act of 1980 ("MPPAA"), provides a number of formulas to assist a multi-employer defined benefits plan's actuary with calculating the withdrawal liability amount. Congress imposed withdrawal liability on withdrawing employers "(1) to protect the interests of participants and beneficiaries in financially distressed multiemployer plans, and (2) ... to ensure benefit security to plan participants." An employer's ability-and willingness-to pay withdrawal liability …

Enforceability Of Third-Party Releases In Foreign Proceedings Under Chapter 15, Anastasia Greer

Bankruptcy Research Library

(Excerpt)

In our increasingly globalized world, cross-border insolvency proceedings brought under chapter 15 (herein "Chapter 15") of title 11 of the United States Code (the "Bankruptcy Code") are on the rise - with over 100 additional filings in 2020 alone. Third-party releases are provisions in bankruptcy plans intended to release non-debtors (including shareholders, directors, officers, and affiliates) from claims creditors hold against other members of their class. A third­ party release can "act as a complete release, waiver, and discharge of that party ... arising out of or in connection with the debtor and its plan of reorganization." While the …

The Approval Of Retirement Contributions In Chapter 13 Payment Plans, Jennifer Hepner

Bankruptcy Research Library

(Excerpt)

In the United States, employees often contribute a portion of their annual income to their 401(k) retirement plans. These contributions may fluctuate based on age, income, or additional contributions by employers. At the same time, chapter 13 debtors are often required to pay at least a portion of what is owed to creditors as part of their court-approved payment plans. A court will only approve a debtor's chapter 13 payment plan if a debtor contributes all of his "projected disposable income" to pay creditors over the "applicable commitment period." While disposable income is defined as the "current monthly income …

A Debtor's Eligibility For Relief Under Subchapter V Of Chapter 11, Nicholas Hasbún

Bankruptcy Research Library

(Excerpt)

In February of 2020, the Small Business Reorganization Act of 2019 ("SBRA") became effective and added a new subchapter ("Subchapter V") to title 11 of the United States Code (the "Bankruptcy Code"). Subchapter V, which is incorporated into chapter 11 of the Bankruptcy Code, was established to create an efficient process for small business debtors to "reorganize quickly, inexpensively, and efficiently." To proceed under Subchapter V, a debtor must meet the definition of a debtor under section 1182(1) of the Bankruptcy Code and must elect its application pursuant to section 103(i) of the Bankruptcy Code. Under Subchapter V, an …

Analysis Of Courts' Discretion To Enforce Arbitration Of Core Claims, Sarah L. Hautzinger

Bankruptcy Research Library

(Excerpt)

In general, a bankruptcy court has original and exclusive jurisdiction of chapter 11 bankruptcy cases. However, problems arise when a prepetition contract contains an arbitration clause, and a court must decide if it has discretion to enforce arbitration of a core claim. The statutes that play essential (but competing) roles in a court's analysis are the Federal Arbitration Act ("FAA") and the United States Bankruptcy Code (the "Bankruptcy Code"). In sum, "bankruptcy policy exerts an inexorable pull towards centralization while arbitration policy advocates a decentralized approach toward dispute resolution."

In these cases, a bankruptcy court must determine if there …

Assessing The Two Tests Courts Use To Determine Dischargeability Of Student Loan Debt, Sean B. King

Bankruptcy Research Library

(Excerpt)

The purpose of bankruptcy is to give honest debtors a “fresh start.” For debtors with student loans this purpose is not automatic, rather, the viability of the student loan programs takes precedence. For student loans, the default rule is they are not dischargeable in bankruptcy. Title 11 of the United States Code (the “Bankruptcy Code”) spells this out. Under section 523(a)(8) of the Bankruptcy Code, student loans must create an “undue hardship” to be discharged.

The issue is how courts determine undue hardship under section 523(a)(8). The term “undue hardship” is not defined in the Bankruptcy Code, rather, it …

Ownership Status Of Inherited Retirement Accounts In Bankruptcy, Aron Kaplan

Bankruptcy Research Library

(Excerpt)

Immediately upon filing a petition for relief under title 11 of the United States Code (the “Bankruptcy Code”), a bankruptcy estate is created by operation of law that consists of the debtor’s assets from which the creditors will be repaid. The Bankruptcy Code states that the estate includes “all legal or equitable interests of the debtor in property as of the commencement of the case.” This broad language reflects Congress’s intent that there be sufficient assets in the estate to protect the interests of creditors.

Despite this broad legislative language, there are certain categories of property that the debtor …