New Jersey Tax Foreclosures Can Be Preferences, Third Circuit Rules
Although a foreclosure sale can be immune from fraudulent transfer attack, a tax foreclosure not based on the value of the property can be a preference.
Overpaying a DSO Doesn’t Result in a Nondischargeable Debt, Seventh Circuit Holds
On an issue dividing the courts, the Seventh Circuit rules that an obligation to repay a domestic support obligation is a dischargeable debt, not a nondischargeable DSO.
An Order Directing Specific Performance Means the Contract Is Not Executory
Idaho’s Judge Myers rules that an order directing specific performance is not a transfer and cannot be a preference.
Earmarking Seems to Be a Dead Letter in the Tenth Circuit
BAP says the Tenth Circuit adopts legal fictions to create preferences.
Fifth Circuit Muses on the Split over Pleading Standards for Fraudulent Schemes
Fifth Circuit generally holds that heightened pleading standards in Rule 9(b) do not apply to claims that don’t rely on fraudulent activity, even though the overall scheme may be fraudulent.
‘Earmarking’ Only Applies When a Debtor Receives a Loan from a Third Party
Money taken from a debtor’s own retirement account to pay a creditor does not qualify for the earmarking defense, Chief Judge Fehling says.
Tardy Recordation of a Mortgage Not Salvaged by Relation-Back Arguments
A mortgage recorded more than 30 days after closing resulted in a transfer within the preference window.
Chicago Case May Resolve the Circuit Split on the New Value Defense
Bankruptcy judge reluctantly follows precedent where the Seventh Circuit is in the minority on the new value defense.