NEWS

Case Summaries

BANKRUPTCY LAW

In a bankruptcy action, where the bankruptcy court dismissed a creditor's adversary complaint alleging that its legal fees were nondischargeable because the debt was obtained by fraud, and sanctioned the creditor, the district court's ruling vacating the sanctions order is: 1) affirmed in part, where the district court correctly concluded that the sanctions order violated the procedural "safe harbor" requirements of Fed. R. Bankr. P. 9011; but 2) reversed in part and remanded with instruction to permit the bankruptcy court to consider alternative avenues to impose sanctions.

09/12: In re AMR Corporation

The bankruptcy court's decision authorizing debtors to obtain post-petition secured financing and to repay existing pre-petition debt owed to creditor U.S. Bank, and denying U.S. Bank's request for relief from the automatic stay is affirmed, where: 1) per the language of the notes' Indenture Agreements, the debtors' voluntary petition for bankruptcy triggered a default that accelerated the debt but required no Make-Whole Amount payment in connection with debt repayment; 2) the pertinent clauses, contained in non-executory contracts, are not within the scope of 11 U.S.C. section 365(e)(1) and are not rendered unenforceable by any other Bankruptcy Code provision identified by U.S. Bank; 3) the debtors complied with its section 1110(a) elections to perform its obligations under the Indentures and cure any non-exempt defaults by making regularly scheduled principal and interest payments, and it was not required to cure its bankruptcy default; and 4) the bankruptcy court did not err in denying U.S. Bank's motion to lift the automatic stay.

09/12: In re AMR Corporation

The bankruptcy court's decision authorizing debtors to obtain post-petition secured financing and to repay existing pre-petition debt owed to creditor U.S. Bank, and denying U.S. Bank's request for relief from the automatic stay is affirmed, where: 1) per the language of the notes' Indenture Agreements, the debtors' voluntary petition for bankruptcy triggered a default that accelerated the debt but required no Make-Whole Amount payment in connection with debt repayment; 2) the pertinent clauses, contained in non-executory contracts, are not within the scope of 11 U.S.C. section 365(e)(1) and are not rendered unenforceable by any other Bankruptcy Code provision identified by U.S. Bank; 3) the debtors complied with its section 1110(a) elections to perform its obligations under the Indentures and cure any non-exempt defaults by making regularly scheduled principal and interest payments, and it was not required to cure its bankruptcy default; and 4) the bankruptcy court did not err in denying U.S. Bank's motion to lift the automatic stay.

CRIMINAL LAW AND PROCEDURE

[09/27] US v. Torres-Vazquez

Defendant's conviction and sentence for conspiracy to commit money laundering following his guilty plea are affirmed, where: 1) based upon defendant's extensive admissions and the circumstances surrounding his possession and transportation of over $1,600,000 in drug-derived cash, a rational fact-finder could conclude that defendant intended to complete a financial transaction, that he conspired with others to this end, that he was aware that the funds in question were the proceeds of unlawful activities, and that those funds were to be used to purchase drugs, so the district court did not err in accepting defendant's guilty plea; and 2) there was no sentencing error.

[09/27] US v. Agosto-Vega

A $2,000 sanction imposed upon defendant's attorney and defendant for filing motions in limine immediately before defendant's anticipated retrial is reversed, where nothing in the Local Rules for the United States District Court for the District of Puerto Rico, or the docket in this case, notified defense counsel of the district court's deadline, or that sanctions might flow from filing the motions when he did.

FAMILY LAW

[09/25] In re J.D.

Juvenile court orders terminating Grandmother's probate guardianship and placing minors with an aunt and uncle, and setting a permanency planning hearing, are affirmed, where: 1) a juvenile court has the authority to terminate a predependency probate guardianship in response to a motion filed by counsel for the dependent minors, whether or not the social services agency that initiated the dependency proceedings so recommends, and even if the probate guardianship was established in a different county; and as such, 2) Grandmother's additional arguments fail.