In (Trial) Courts (Especially) We Trust

VIKRAM DAVID AMAR, JASON MAZZONE

Illinois law dean Vikram David Amar and professor Jason Mazzone describe the increasing importance of courts and lawyers in safeguarding and reinforcing the role of factual truths in our democracy. Dean Amar and Professor Mazzone point out that lawyers and judges are steeped in factual investigation and factual determination, and they call upon legal educators (like themselves) to continue instilling in students the commitment to analytical reasoning based in factual evidence, and to absolutely reject the notion that factual truth is just in the mind of the beholder.

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The Rhetoric About a “Decline” in Religious Liberty Is Good News for Americans

MARCI A. HAMILTON

Marci A. Hamilton, a professor at the University of Pennsylvania and one of the country’s leading church-state scholars, explains why the rhetoric about a “decline” in religious liberty actually signals a decline in religious triumphalism, and is a good thing. Professor Hamilton describes how religious actors wield the Religious Freedom Restoration Act (RFRA) not as a shield, but as a sword to destroy the lives of fellow Americans.

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Brooks v. First Central Bank McCook

Court: US Court of Appeals for the Eighth Circuit

Docket: 20-6014

Opinion Date: November 25, 2020

Judge: Nail

Areas of Law: Bankruptcy

The Bankruptcy Appellate Panel affirmed the bankruptcy court's order granting the Bank relief from the automatic stay. The panel held that the default provisions in debtor's Chapter 12 plan were dispositive of the Bank's motion for relief from the automatic stay. In this case, debtor admits he agreed to make certain payments on January 15, 2020; he made only a portion of those payments; and thus debtor was in default under his plan and the Bank was entitled to relief from the automatic stay.

Iowa Department of Revenue v. DeVries

Court: US Court of Appeals for the Eighth Circuit

Docket: 20-6011

Opinion Date: November 25, 2020

Judge: Schermer

Areas of Law: Bankruptcy

The Bankruptcy Appellate Panel reversed the bankruptcy court's order confirming the Chapter 12 plan of debtors. The panel held that the plain language of Bankruptcy Code 1232 does not allow a Chapter 12 plan to compel a taxing authority to disgorge pre-petition withholdings. In this case, contrary to debtors' position, section 1232 provides no basis to magically reverse the application of the pre-petition withheld funds when calculating the IDR's claim.

Lorenzen v. Taggart

Court: US Court of Appeals for the Ninth Circuit

Dockets: 16-35402, 16-60032, 16-60033, 16-60039, 16-60040, 16-60042, 16-60043

Opinion Date: November 24, 2020

Judge: Carlos T. Bea

Areas of Law: Bankruptcy

On remand from the Supreme Court, the Ninth Circuit affirmed the Bankruptcy Appellate Panel's decision reversing the bankruptcy court's finding of civil contempt and vacating its award of civil contempt sanctions against a debtor's former business partners for violation of the discharge injunction. The Supreme Court explained that an objective, rather than subjective, standard is more appropriate in determining whether the Creditors could be held in civil contempt for violating the bankruptcy discharge injunction. Furthermore, "a court may hold a creditor in civil contempt for violating a discharge order if there is no fair ground of doubt as to whether the order barred the creditor's conduct." Applying this standard, the panel held that the Creditors had an objectively reasonable basis to conclude that debtor might have "returned to the fray" in the Oregon state court to obtain some economic benefit from a higher evaluation of the sale of his ownership stake in SPBC and in the amount of interest that had accrued after the date payment was due for the forced sale.

Manikan v. Peters & Freedman, LLP

Court: US Court of Appeals for the Ninth Circuit

Docket: 19-55393

Opinion Date: November 25, 2020

Judge: Danielle J. Hunsaker

Areas of Law: Bankruptcy, Consumer Law

The Ninth Circuit reversed the district court's grant of summary judgment for defendants in an action brought by plaintiff under the Fair Debt Collection Practices Act (FDCPA). Plaintiff alleged that P&F violated the FDCPA by attempting to collect a debt that was no longer owed and that P&F's agent, AAS, violated the FDCPA in attempting to collect the debt. Walls v. Wells Fargo Bank, N.A., 276 F.3d 502 (9th Cir. 2002), precludes claims under the FDCPA. The panel held that Walls does not extend to this circumstance because plaintiff's FDCPA claims are based on the wholly independent ground of full payment, rather than being premised on a violation of the discharge order.

Sutton 58 Associates LLC v. Pilevsky

Court: New York Court of Appeals

Citation: 2020 NY Slip Op 06939

Opinion Date: November 24, 2020

Judge: Stein

Areas of Law: Bankruptcy, Civil Procedure, Commercial Law

The Court of Appeals held that federal bankruptcy law did not preempt Plaintiff's state law claims asserted against non-debtor third parties for tortious interference with a contract. Plaintiff loaned $147,250,000 to nonparties "Mezz Borrower" and "Mortgage Borrower" (collectively, Borrowers). Borrowers later defaulted, and Plaintiff sought to conduct a foreclosure sale of Mezz Borrower's 100 percent membership interest in Mortgage Borrower pursuant to the pledge and security agreement. Mezz Borrower and Mortgage Borrower subsequently filed separate voluntary petitions for chapter 11 bankruptcy in federal court. Plaintiff then commenced this action in state court alleging that Defendants had tortiously interfered with the loan agreements between Plaintiff and the nonparty borrowers. Defendants - various affiliated persons and entities - moved for summary judgment on the ground that the action was preempted by the Bankruptcy Code. Supreme Court denied the motion, holding that the action was not preempted because it did not involve the bankruptcy. The Appellate Division reversed, concluding that Plaintiff's claims were preempted by federal law because damages arose only because of the bankruptcy filings. The Court of Appeals reversed, holding that Defendants failed to meet their burden of establishing that federal bankruptcy law preempted Plaintiff's tortious interference claims.