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THE CONSUMER BANKRUPTCY LETTER |
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In This Issue:
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November 1, 2004
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NEXT STOP - SAN ANTONIO
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BankruptcyBooks.com - ALL PUBLISHERS
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PENDING EVENTS, SEMINARS & CLE
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HEADS-UP ON RECENT CASES
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NO NEW BANKRUPTCY JUDGES
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DISCHARGING TAXES - THE POWER SEMINAR!
JOIN MORGAN KING & YOUR COLLEAGUES FROM AROUND THE COUNTRY ... IN SAN ANTONIO, TEXAS
JANUARY 27, 28, 29 2005
DISCHARGING TAXES - FUNDAMENTALS & ADVANCED PROBLEMS
The next date scheduled for the 5th annual 3-day Bankruptcy Academy on discharging taxes in bankruptcy cases has been scheduled for -
SAN ANTONIO, Texas, January 27, 28 & 29, 2005.
Additional 2005 dates are pending.
The 3-day seminar and workshop will be a thorough exploration of bankruptcy remedies for delinquent taxes and tax liens in consumer bankruptcy cases (chapter 7 and chapter 13), emphasizing practical handlng of tax discharge cases from A-to-Z.
CLE ACCREDITATION
Previous programs have qualified for CLE in all states for which CLE accreditation was requested. The Academy is applying for attorneys' CLE accreditation in all states for which CLE is mandatory.
CPE accreditation from the IRS for enrolled agents has been approved.
TUITION
Single attorney $645 until Jan. 10 2005
Texas attorneys only - single attorney $595
Double attorney registration any location $995
Paralegal or other office staff any location $350
Enrolled agent or CPA any location $495
For more information about the Tax Discharge program, or to enroll, click on red below or call (925) 829-6460 west coast time.
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November 11, 2004 - November 14, 2004
COMMERCIAL LAW LEAGUE OF AMERICAN
The New York Meeting
New York City, New York
CLLA.org
December 2-4, 2004
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Marriott's Camelback Inn, Scottsdale, AZ
Contact: 1-703-739-0800 or
abiworld.org
January 27, 28, 29 2005
KING BANKRUPTCY ACADEMY
Discharging Taxes in Bankruptcy From A to Z
San Antonio, Texas
BankruptcyAcademy.com
February 26 - March 1 2005
NORTON INSTITUTES OF BANKRUPTCY LAW
Park City, Utah
nortoninstitutes.org
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HOUSE JUDICIARY APPROVES NEW JUDGESHIPS, BUT NOT FOR BANKRUPTCY
September 9th, the House Judiciary Committee approved by voice vote S.878, a bill passed by the Senate in May, creating new federal judgeships, but the House stripped out provisions for new federal bankruptcy judges.
It is uncertain whether the Senate will accept the amendments.
David Goch
Washington Legislative Counsel
Commercial Law League of America
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BILL-PADDING ATTORNEY GETS SUSPENSION
18-B specialist who bilked New York City out of thousands of dollars faces three years off.
An attorney who bilked New York City's Assigned Counsel Plan (ACP) out of thousands of dollars has been suspended for three years by the Appellate Division, First Department.
A hearing panel of the department's Disciplinary Committee had recommended only a six-month suspension, citing the quality of the attorney's work and her bouts with depression and alcohol abuse. The lawyer, Sara Goldman, was known as one of the most reliable and adept attorneys to handle alleged parole violations for inmates at Rikers Island, which she had done since 1989, co-workers and an administrative law judge said in letters.
Tom Perrotta
New York Law Journal
10-28-2004
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CONSUMER CONFIDENCE DROPS
NEW YORK -- Worries about the future sent consumers' assessment of the economy in October spiraling down to its lowest level since last March, according to a report released Tuesday.
The Conference Board said its index of consumer confidence for October moved lower for a third straight month to a reading of 92.8, after the revised 96.7 seen the month before. October's level fell short of the median projection of economists surveyed by Dow Jones Newswires for a reading of 94.0..
"Subdued expectations, as opposed to eroding present-day conditions, were the major cause behind October's decline in consumer confidence," said Conference Board economist Lynn Franco in a statement. "While consumers' assessment of the labor market this month showed a moderate improvement, the gain was not sufficient to ease concerns about job growth in the months ahead," she said.
The private research group's expectations index fell to 92.0, compared with the revised 97.7 the prior month. The expectations measure was also at its lowest point since the 91.3 seen last March.
By Michael S. Derby
Dow Jones Newswires
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DEBTOR'S ATTORNEY SANCTIONED FOR MOVING TO RECUSE TRUSTEE WITHOUT REASONABLE INQUIRY FIRST
Rule 11 sanctions were warranted against a debtor's attorney who filed a motion to recuse a Ch. 7 trustee (based upon alleged racial/ethnic prejudice) without conducting a reasonable investigation onto the facts asserted in the motion to recuse. The evidence reveals that the allegations of fact made the subject of the Motion to Recuse are blatantly untrue and were made by debtors’ counsel without even minimal investigation or consideration of the possible consequences.
Debtor's attorney did not attend the meeting of creditors, did not order a transcript of the hearing, and did not call the trustee to discuss the matter. He apparently based his motion entirely on the debtor's recounting of the meeting. The court found this to be an inadequate inquiry.
In re Hajje (Bankr. N.D. Tex. 2004)
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PETITION PREPARER SANCTIONED FOR EXCESSIVE FEES AND PRACTICING LAW WITHOUT A LICENSE
The court required Kristin Motley, a bankruptcy petition preparer, to appear so that the court might determine whether the $214.00 total fee paid by the Debtors to Ms. Motley in each of these eleven bankruptcy cases for "document preparation services" is in excess of the value of the services rendered; to show cause why certain specified services rendered to the Debtors by Ms. Motley should not be found to constitute violations of 11 U.S.C.A. § 110, including 11 U.S.C.A. § 110(k), which prohibits a bankruptcy petition preparer from engaging in the unauthorized practice of law, and; to show cause why a fine should not be imposed against her in each case.
Ms. Motley testified that We the People of Knoxville offers the preparation services for approximately fifty other types of legal documents, including, among others, uncontested divorces, powers of attorney, name changes, wills, and trusts. Ms. Motley opened We the People of Knoxville in January 2004, and she is its only employee, although she testified that her husband occasionally assists her by answering phones. She purchased the franchise in September 2003, for $89,500.00, and she pays a monthly fee of 25% of her gross profits to We the People USA. In exchange, We the People USA provides Ms. Motley with the assistance of a supervising attorney, the assistance of a typist/processor, television advertisements, corporate support, documents for distribution, and use of the company's name.
The court ordered refund of fees, plus sanctions and enjoined Ms. Motley from further similar offenses.
IN RE ROSE, (E.D.Tenn. 2004)
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PRE-EXISTING DISABILITY MAY JUSTIFY DISCHARGE OF STUDENT LOANS
A pre-existing disability can constitute the basis for an undue hardship discharge of a student loan. A partial undue hardship discharge of a student loan is authorized.
In re Mason (9th Cir. BAP 2004)
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ARTHRITIC CONDITION DOES NOT JUSTIFY HARDSHIP DISCHARGE OF STUDENT LOANS
While Debtor may be in the early stages of an arthritic condition, he has arbitrarily limited his geographic employment options, shown no real effort to gain employment, and intentionally elected not to make attempts to repay his student loans. The standards which must be satisfied to discharge educational debt, based upon undue harship, are intentionally difficult to satisfy. Debtor has not presented facts which satisfy this high standard. Clearly, Debtor has not established by a preponderance of the evidence that an undue hardship discharge is warranted. The student loan is excepted from Debtor's discharge. His dischargeability complaint is denied.
IN RE HOOTMAN, (N.D.Iowa 2004)
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ATTORNEY FOR OVERSECURED CREDITOR IS AWARDED ATTORNEY'S FEES
An order denying relief from the automatic stay on condition that the debtor make adequate protection payments, and without prejudice to the creditor seeking stay relief in the future, is a final order for purposes of appellate review.
The bankruptcy court did not err in awarding an oversecured creditor attorney fees in connection with the creditor's relief form stay motion.
In re Kamai (9th Cir. BAP 2004)
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VIOLATION OF AUTOMATIC STAY JUSTIFIES SANCTIONS AND DAMAGES OF $750,000
After foreclosing on the debtor's residence, the creditor removed and auctioned off all of her personal property, and dumped expensive marketing materials the debter had developed for her business in the trash.
A willful violation of the automatic stay warrants a six figure punitive damage sanction under 11 USC 362(h). Because Defendants willfully violated the automatic stay, Kaufman is entitled to actual damages. Section 362(h); Ramirez, 183 B.R. at 589 (award of actual damages, costs, and fees is mandatory under § 362(h) upon a finding of a willful violation). The basic measure of damages is the amount of the economic loss Kaufman suffered as the proximate result of Defendants’ violation, taking into account the fair market value of the property that they disposed of in violation of the stay, In re Dawson, 367 F.3d 1174, 1179 (9th Cir. (2004), and any other factors relevant to making Kaufman economically whole. See, e.g., In re Walters, 41 B.R. 511, 516-17 (Bankr. W.D. Mo. 1984). Damages for emotional distress, however, may not be awarded. Dawson, 367 F.3d at 1180-81.
The court therefore holds that, for purposes of § 362(h), Kaufman suffered actual damages in the sum of $116,000.14 E. PUNITIVE DAMAGES. Section 362(h) provides that a debtor injured by a willful violation of the automatic stay may recover punitive damages “in appropriate circumstances.” Although the Bankruptcy Code does not specify the circumstances that are appropriate, general case law regarding punitive damages does. As the Ninth Circuit stated in Professional Seminar Consultants v. Sino American Tech. Exchange Council, Inc., 727 F.2d 1470, 1473 (9th Cir. 1984): The fact finder has considerable discretion in fixing damages. The factors to be considered are (1) the nature of the defendants’ acts; (2)the amount of the compensatory damages awarded; and (3) the wealth of the defendants. (Internal citation omitted.) In addition, the Supreme Court has observed that the purpose of punitive damages in civil cases is the governmental one of deterrence and retribution, and has held that due process dictates that punitive damage awards not be grossly excessive or arbitrary. Awarded: $750,000.
In re Kaufman Bankr. (N.D. Ca. 2004)
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PATTERN OF CONCEALING ASSETS JUSTIFIES COURT REFUSAL TO PERMIT CONVERSION OF CASE FROM CHAPTER 7 TO CHAPTER 13
This Debtor's actions are . . . egregious because there seems to have been a pattern of attempts to conceal assets — a pattern that began before the Debtor filed his petition when he transferred the Maine Property for no consideration to the Trust, and continued postpetition until the Chapter 7 Trustee threatened action to recover the Maine Property. As has been stated by the United States Supreme Court, the opportunity provided by the bankruptcy law for a "fresh start" is limited to the "honest but unfortunate debtor." Grogan v. Garner,
498 U.S. 279, 286-87 (1991).
Accordingly, we resolve, in conformity with our prior decisions in Kuntz and Cabral, that the bankruptcy court has authority to deny a debtor's request for conversion to Chapter 13.
MARRAMA v. CITIZENS BANK OF MASSACHUSETTS, (1st Cir. BAP 2004)
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Barry Barnum, the unrecognized illegitimate grandson of the famed circus promoter PT Barnum, currently CEO of OneEveryMinute (an Internet marketing firm) will speak this Friday at the Regency. The topic of discussion is his latest book Bankruptcy as a Branding Event.
Mr. Barnum won critical acclaim for his best selling work: Your Company Is Your IPO. In this landmark work, Barnum explains, "it is easier to say what you want to do than to do what you've said...so you have to be prepared to get out of town fast, and run quickly."
The American Linguistic Society hailed Your Company is Your IPO as one of the best sources for modern buzzwords and business lexicon.
"This book is absolutely amazing," says Harvard literary professor Howard Thinkalot, "The author filled over three hundred pages with buzzwords and catch phrases, without so much as a single hint of content."
It is a must read for companies that don't have a product but want to sell stock.
In Bankruptcy as a Branding Event, Mr. Barnum notes that many dotcoms saw more hits during their bankruptcy and layoff events than during their IPO or even their Superbowl ads.
The challenge for today's businessman is to get the most from a company's downfall, while insulating their pocketbooks from the financial turmoil caused to employees or investors.
Good placement on Dotcom doom sites can double Internet traffic to your site. To get the best placement, you must do something outrageous, such as slashing your employees pay just before going under.
- Kevin M Delaney
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PUBLISHED BY KING BANKRUPTCY MEDIA FOR BANKRUPTCY PROFESSIONALS 7080 Donlon Way Suite 222 Dublin California 94568 (925) 829-6460
© King Bankruptcy Media 2004 CONTACT US AT editor@bankruptcymedia.com
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