Khan v. Barton

(United States Ninth Circuit) – In a bankruptcy case that was converted to Chapter 13 from Chapter 7, the bankruptcy court’s judgment is affirmed where: 1) a creditor’s claims were not subordinated because the creditor’s claims did not arise out of a purchase or sale of securities, but rather were based upon a judgment entered against the debtors on account of their actions in fraudulently converting the creditor’s stock; and 2) the bankruptcy court did not clearly err when it found bad faith and did not abuse its discretion when it converted debtors’ Chapter 13 bankruptcy proceedings to Chapter 7 proceedings.

Birmingham v. PNC Bank, N.A.

(United States Third Circuit) – In a Chapter 13 voluntary bankruptcy case, the district court’s determination, that the provisions of debtor’s Deed of Trust does not allow debtor to bifurcate is affirmed, where reference in the Deed of Trust to escrow funds, insurance proceeds, or miscellaneous proceeds constitutes incidental property for purposes of 11 U.S.C. section 1322(b)(2), which entitles mortgagor-defendant to anti-modification protection under section 1322(b)(2).

Trikona Advisers Limited v. Chugh

(California Court of Appeal) – In a complaint alleging breach of fiduciary duty by defendant, a former partner and fifty percent owner of plaintiff corporation, the district court’s grant of summary judgment to defendants is affirmed over plaintiff’s meritless arguments that: 1) the district court incorrectly applied the doctrine of collateral estoppel; and 2) Chapter 15 of the United States Bankruptcy Code prevents the district court from giving preclusive effect to the Cayman court’s factual findings.

Marblegate Asset Mgmt., LLC v. Educ. Mgmt. Fin. Corp.

(United States First Circuit) – In an appeal arising out a company’s debt restructuring, the district court’s holding, that a series of transactions meant to restructure defendant’s debt over the objections of certain noteholders violated Section 316(b) of the Trust Indenture Act of 1939, 15 U.S.C. section 77ppp(b), is vacated where section 316(b) prohibits only non‐consensual amendments to an indenture’s core payment terms.

Peaje Investments LLC v. Garcia-Padilla

(United States First Circuit) – In consolidated appeals involving the application of certain provisions of the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA), 48 U.S.C. sections 2101-2241, a statute enacted by Congress in June 2016 to address Puerto Rico’s financial crisis, the district court’s judgment is: 1) affirmed as to denial of Peaje Investments LLC’s lift-stay motion where plaintiff failed to set forth a legally sufficient claim of ’cause’ to lift the PROMESA stay; and 2) vacated as to denial of other plaintiffs’ lift-stay motion where they presented sufficient allegations to entitle them to a hearing.