Illinois Bankruptcy Lawyer Blog

In re Robert R. Williams, 10-012193
Fifth Third v. R. Williams, 10-001663

Issued March 11, 2011 by
Judge Benjamin Goldgar

Click here to view and download the opinion in .pdf format

In re Richard Sharif, 09-05868
Issued on March 14, 2011
By Hon. Jacqueline P. Cox

The Story: The Court entered orders in an Adversary case providing, among other things, that the Soad Wattar Revocable Trust of 1992 was the alter ego of Debtor Richard Shariff (July 06, 2010 Order), and that Wells Fargo Financial Advisors must turn over Trust assets to the Bankruptcy Trustee pursuant to FRCP 60 (August 5, 2010). Movant Ragda Sharifeh sought relief from those orders and leave to intervene in the proceedings. On March 10, 2011 the Court ruled.

The Issues: Movant Sharifeh sought to vacate the portion of the July 06 Order that deemed the Trust to be the Debtor's alter ego; and overturn the order relating to Wells Fargo. In the alternative, the movant invoked FRBP 8005 and asked that enforcement of the August 5 Order be stayed pending final disposition of a related adversary proceeding.

The Upshot: On March 10, 2011 the Court denied Sharifeh's motion and ruled that

(1) The movant had failed to establish the the prerequisites for the imposition of a stay under FRBP 8005;
(2) FRCP 60 was not the proper vehicle for asserting the movant's legal error argument in any case; and
(3) The Court no longer had jurisdiction to act on the orders; which could be appealed to the District Court.

Click here to view and download the opinion in .pdf format

In re Jahelka ,(Bkrtcy.N.D.Ill.)

The Upshot: An adversary complaint seeking to deny the discharge of an individual Ch. 11 debtor due to his inability to produce financial records or explain the loss of his assets was determined to be premature. The Opinion: The Court ruled that in a liquidating Ch. 11 such as the one under consideration, 11 U.S.C.A. 1141(d)(3) made exceptions to discharge inaplicable until the debtor proposed a plan by which to dispose of property of the estate.

Bankruptcy: In re National Jockey Club, 06-13247

Adversary: DII Northwest v Th. Carey, 10-000302

Issued Mar. 03, 2011

Judge Pamela Hollis

The Issue: Defendant brought motion to dismiss adversary complaint that sought a turnover of assets based on an alleged breach of fiduciary duty.

The Upshot: Motion granted on both counts; Adversary Complaint dismissed.

The Opinion: First, the Plaintiff failed to allege a basis for its assertion that the target funds were property of the bankruptcy estate. As such, its turnover claim had to be denied. Second, the Plaintiff’s breach of fiduciary claim was barred by the statute of limitations because it was not brought within 5 years of the date on which the claim arose. The so-called continuing violation doctrine did not apply to constructively render the claim timely.

Click here to view and download the opinion in .pdf format.

The Facts: Chapter 11 Debtor failed to segregate its employee's wages and apply a portion toward a group health insurance premium. When those funds were seized later by a creditor, the employees left with a 5th priority wage claim and a lapsed insurance policy.

The Issue: Employee alleged that the funds taken should be classified as a contribution to an employee benefit plan arising from services rendered within 180 days before the filing date of the case.

The Upshot: The Court agreed that the funds had been earned with the 180 days before the case was filed, and also ruled that employees also had an administrative expense claim for wages that were withheld but not applied during the post-petition. Finally, the Court ruled that employees had a claim for un-reimbursed medical expenses that would have been covered under the policy, had it not expired.