ATexasBankruptcyLawyersBlog

The Alex Jones Bankruptcy Gambit

04/19/22

 In a widely misunderstood move, Alex Jones and his legal team have put three of his entities that own intellectual property assets into SubChapter V of Chapter 11. The move, if successful, will protect the domain name, infowars.com, and will delay entry of judgments against Jones personally. The move involves apparent forum shopping and clever use of SubChapter V. The cases are jointly administered under Case. No. 22-60020 in the Southern District of Texas, Victoria Division.

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Southern District of Texas Conducts Spring Cleaning of Noticing

03/21/22

Every day bankruptcy clerks sent out millions of required notifications to creditors and parties in interest. Creditors can bypass the paper notification by designating an email address for service pursuant to Fed.R.Bankr.P. 9036.

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Fifth Circuit Opinion Illustrates Risks of Class Proofs of Claim

03/14/22
A new opinion from the Fifth Circuit highlights the perils of class proofs of claim, something I recently wrote about here. In West Wilmington Oilfield Claimants v. Nabors Corporate Services, Inc. (Matter of CJ Holding Company), Case No. 21-20394 (5th Cir. 3/10/22), the Fifth Circuit upheld a bankruptcy court decision which denied creditors covered by a putative class claim permission to file late claims.
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Trustee Who Sought Turnover of Contract Receivable Bound by Arbitration Clause

03/10/22

A trustee who sought "turnover" of amounts owed under a construction contract had an arbitration clause in that contract enforced against him. The Bankruptcy Court found that the bankruptcy exception to enforcement of an arbitration clause was narrow and did not apply to a construction dispute. Satija v.  Kella (In re Davila General Contractors, LLC), Adv. No. 21-1047 (Bankr. W.D. Tex. 3/9/22). The order can be found on CM/ECF at Docket #23.

What Happened

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Fifth Circuit Upholds Injunctive Relief Against Single-Member Limited Liability Company

03/08/22

 One of the benefits of holding property or doing business through a limited liability company is that "entry of a charging order is the exclusive remedy by which a judgment creditor of a member or of any other owner of a membership interest may satisfy a judgment out of the judgment debtor's membership interest." Tex.Bus.Org. Code Sec. 101.112(d). But just how exclusive is that right? A recent Fifth Circuit opinion holds that a court may impose additional conditions on a judgment debtor's LLC in the name of carrying out the court's orders.  Thomas v.

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A Look at the Jurisprudence of Judge Ketanji Brown Jackson (Bankruptcy and Otherwise)

03/04/22

Supreme Court nominee Judge Ketanji Brown Jackson has played a variety of roles in her legal career. She has been a public defender, an attorney in private practice, a member of the U.S. Sentencing Commission, a U.S. District Judge and a Court of Appeals Judge. Unfortunately, these jobs have given her scant exposure to bankruptcy law. I will explore all three of her bankruptcy related opinions (out of a total of about 600) as well as a handful of her other jurisprudence.

A Small Exposure to Bankruptcy

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Class Proofs of Claim Involve Procedural Minefield

02/22/22
Bankruptcy has been likened to a class action. In a typical class action, a class representative files suit against a defendant seeking relief on behalf of a class of plaintiff. If class certification is not granted, the suit continues as a conventional suit. In bankruptcy, a debtor files for relief against his or her creditors. However, as shown by Fed.R.Bankr.P. 7023, it is possible to have a traditional class action within the collective proceeding of a bankruptcy. Sometimes this is done through the vehicle of filing a class proof of claim.
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Fifth Circuit Opinion Upholds Limits on Actions Between Non-Debtors

02/11/22

 In a case involving multiple parties and proceedings, the Fifth Circuit has affirmed lower court rulings which prohibited one non-debtor from suing a second non-debtor and awarded sanctions against a party that told a state court to disregard the Bankruptcy Court's orders. In the Matter of PFO Global, Incorporated, Case No. 20-10885 (5th Cir. 2/9/22), which can be found here.

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District Court Finds Plan Provision So Broad It Exceeded Jurisdiction

02/02/22

While bankruptcy subject matter jurisdiction is broad, sometimes an order can just go too far as shown by the recent opinion from the U.S. District Court for the Eastern District of Virginia in Patterson v. Mahway Bergen  Retail Group, Inc., 2022 U.S. Dist. LEXIS 7431 (E.D. Va. 2022).

The Three Types of Jurisdiction

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Defaulting Auction Bidder Finds Evidentiary Mess

01/21/22

A new opinion from the Fifth Circuit shows multiple mishaps in connection with a bankruptcy-related auction. However, its most important holding has to do with authenticating evidence. The bottom line is that a trial court decision limiting a defaulting bidder's damages based on a webpage found on the Wayback Machine was reversed. Weinhoffer v. Davie Shoring, Inc., Case No. 20-30568 (5th Cir. 1/20/22).  You can find the opinion here. 

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