Blogs

Bankruptcy Bulletin: SCOTUS Holds the Uniformity Clause Is Satisfied by Prospective Parity on UST Fee Issue

By David Tanabe posted 6 days ago
Contributing Author: Stanley Chow University of Minnesota Law School Juris Doctor Candidate, 2025 Judicial Extern to U.S. Bankruptcy Judge Kesha Tanabe Even a brief summary of Office of United States Trustee v. John Q. Hammons Fall 2006, LLC , 144 S. Ct. 1588, 1590 (2024), requires some background storytelling. Before 1978, bankruptcy judges used to handle both administrative and judicial functions in bankruptcy cases, such as appointing and supervising private trustees when needed. To some, this created an appearance of bias. Addressing this issue, Congress piloted the United States Trustee Program (the “UST”) in 1978, and subsequently ...

BANKRUPTCY BULLETIN: Bankruptcy Court Held Defendant Liable as Initial Transferee for Constructively Fraudulent Transfer Under Section 548

By David Tanabe posted 11 days ago
BANKRUPTCY BULLETIN In In re Landin , 2024 WL 2947598 (Bankr. D. Minn. June 11, 2024), the bankruptcy court held that the transfer was avoidable because it was constructively fraudulent under 11 U.S.C. § 548, and the defendant was liable for the full amount of the transfer as the initial transferee under 11 U.S.C. § 550. The defendant maintained that he entered into an arrangement with his brother, the debtor, for $8,000 to be transferred from the debtor’s 401(k) account to the defendant’s checking account. The transfer occurred just two weeks prior to the commencement of the debtor’s chapter 7 case. The chapter 7 trustee and the defendant disagreed ...

BANKRUPTCY BULLETIN: Supreme Court Held That Insurers With Financial Responsibility For Bankruptcy Claims Are Parties In Interest

By David Tanabe posted 18 days ago
BANKRUPTCY BULLETIN Contributing Editors: Samantha J. Hanson-Lenn , Stinson LLP Luke Sperduto , Stinson LLP The Supreme Court recently held in Truck Ins. Exch. v. Kaiser Gypsum Co., Inc. , 602 U.S. __, 144 S. Ct. 1414 (2024), that an insurer with financial responsibility for a bankruptcy claim is a “party in interest” under 11 U.S.C. § 1109(b) that may raise and be heard on any issue in a bankruptcy case. On September 30, 2016 Kaiser Gypsum Company, Inc. and its parent company, Hanson Permanente Cement, Inc. (the “ Debtors ”), each filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy ...

BANKRUPTCY BULLETIN: Federal Court Holds Causes of Action Based on Violations of Bankruptcy Automatic Stay and Fair Debt Collections Practices Act Can Be Enforced Concurrently

By David Tanabe posted 21 days ago
BANKRUPTCY BULLETIN Contributing Author: David M. Tanabe , Messerli & Kramer P.A. In Nelson v. Saint Catherine University , 2024 WL 2302334 (D. Minn. May 21, 2024), the United States District Court held that claims based on violations of the bankruptcy automatic stay under 11 U.S.C. § 362 and the Fair Debt Collections Practices Act (“FDCPA”) can be enforced concurrently. In the matter, the university retained a law firm to file a collections action against the debtor in state district court. Thereafter, the debtor commenced a chapter 7 bankruptcy case. The debtor’s bankruptcy counsel emailed the law firm identifying the representation ...

To Avoid Cyber Attacks, Beware of Social Engineering

By Mary Warner posted 24 days ago
I found a copy of "Ghost in the Wires: My Adventures as the World's Most Wanted Hacker " by Kevin Mitnick with William L. Simon for sale on the Friends of the Library shelf at my local library recently. For a buck or two, it made for an exciting read on the early days of hacking. Mitnick started out as a phone phreaker when he was a teenager, which reminded me of how intertwined phones and computers are. Phone phreakers were people who figured out how to reconfigure phone systems and their switching equipment in order to make free long distance calls. From there, Mitnick progressed to hacking into computer systems. He served prison time for his activities, ...

BANKRUPTCY BULLETIN: Bankruptcy Court Held Federal Tax Liens Were Not Deductible Expenses from the Debtors’ Chapter 7 Means Test

By David Tanabe posted 06-17-2024
In In re Sczepanski , 2024 WL 1738224 (Bankr. D. Minn. Apr. 22, 2024), the bankruptcy court granted the United States Trustee’s (“UST”) motion to dismiss the chapter 7 case for abuse pursuant to 11 U.S.C. § 707(b)(2) in holding a presumption of abuse arose because the debtors’ federal tax liens were improperly deducted from their monthly disposable income for the means test. For the means test, the debtors deducted $1,587 per month on account of three federal tax liens (“Tax Liens”) encumbering the debtors’ homestead. In opposition to the UST’s motion, the debtors argued the plain language of § 707(b)(2)(A)(iii) supports that they properly deducted the ...

Artificial Sweetener: How Law Firms Should Engage AI

By Mary Warner posted 05-30-2024
Artificial Sweetener: How Law Firms Should Engage AI By Jared Correia, Red Cave Law Firm Consulting Artificial intelligence has finally captured the popular zeitgeist via ChatGPT – a generative AI program, that can provide near-instantaneous responses to almost any query. Before we get too far along here, note that artificial intelligence is , essentially , the mimicking of human intelligence by a computer system that has learned via a ‘large language model ’, i.e. l ots of varied data. Generative AI is simply an AI program that offers data output, whether it’s text (like ChatGPT and G oogle Gemini ), or images ...

BANKRUPTCY BULLETIN: Bankruptcy Court Held the Pleading Standard for Constructively Fraudulent Transfer Required Sufficient Factual Allegations Related to Reasonably Equivalent Value to State a Plausible Claim for Relief

By David Tanabe posted 05-29-2024
BANKRUPTCY BULLETIN In Stermer v. United States (In re Farhat) , 2024 WL 2195088 (Bankr. D. Minn. May 15, 2024), the bankruptcy court granted the IRS’s motion to dismiss the complaint as to the claims based on constructively fraudulent transfers because the chapter 7 trustee failed to adequately plead the debtor received less than reasonably equivalent value in exchange for the transfers. The bankruptcy court denied the motion to dismiss the preference claim. The debtor filed a bankruptcy petition on February 9, 2023, for chapter 7 relief. Within the ninety days preceding the filing, the debtor made two pre-petition transfers to the IRS totaling ...

Bankruptcy Bulletin: SCOTUS Held the CFPB’s Unique Funding Mechanism is Constitutional

By David Tanabe posted 05-28-2024
BANKRUPTCY BULLETIN Contributing Editor: Lee Owen University of Minnesota Law School, JD Class of 2024 In CFPB v. Community Financial Services Association of America , 601 U.S. (2024), the Supreme Court of the United States held that the manner in which the Consumer Financial Protection Bureau (“CFPB”) is funded is constitutional. Pursuant to the Dodd-Frank Act, the CFPB is funded annually through the Federal Reserve System’s combined earnings, at the CFPB director’s discretion, in an amount not to exceed 12% of the Federal Reserve System’s operating expenses. 12 U.S.C. § 5497(a)(1), (2)(A)(iii). This is distinct ...

The Next Level of GenAI - GPT-4o and Project Astra

By Mary Warner posted 05-28-2024
Developments in the field of generative AI (GenAI) continue at a galloping pace. There have been some major developments in the past few weeks that bear mentioning now (rather than in an annual round-up of AI news) because they may have a significant impact on legal tech and the law. OpenAI’s GPT-4o On May 13, 2024, OpenAI announced the release of GPT-4o. The ‘o’ stands for ‘omni,’ with this GPT operating with very fast multimodal capabilities. That means it can respond to text, voice, video, and images at a speed that is comparable to human response times. The best way to understand what GPT-4o does is to watch some of OpenAI’s demo videos, in ...

Trademark Search skills training

By Thomas James posted 05-15-2024
Learn how to perform trademark searches using the USPTO's new search system. 3 noon webinars. Attend all three or choose only the ones you need. 6/10/24: Basic Trademark Law: and “Likelihood of Confusion” Analysis 6/10/2024 6/11/24: The USPTO’s New TM Search System 6/12/24: Advanced TM Searching with Regular Expressions For more information or to register, visit the course page .

Bankruptcy Bulletin: 8th Circuit BAP Holds the Pre-Conversion Claim for Unpaid Child Support Should Receive Special Treatment Under Section 348(d) Despite Multiple Conversions in the Case

By Andrew Page posted 05-07-2024
Bankruptcy Bulletin: 8th Circuit BAP Holds the Pre-Conversion Claim for Unpaid Child Support Should Receive Special Treatment Under Section 348(d) Despite Multiple Conversions in the Case BANKRUPTCY BULLETIN Contributing Editor: Andrew Page , Maslon LLP In LaMonda v. Harder (In re Lamonda), 656 B.R. 494 (B.A.P. 8th Cir. 2024), the United States Bankruptcy Appellate Panel for the Eighth Circuit held the claim for unpaid child support was within the plain meaning of 11 U.S.C. § 348(d) despite multiple conversions in the bankruptcy case. In the case, Justin Gary LaMonda (“Debtor”) filed bankruptcy under Chapter 7 of the Bankruptcy ...

Real Estate Development: How the Landscape of SEO Has Changed

By Mary Warner posted 05-07-2024
The following blog post is by Jared Correia of Red Cave Law Firm Consulting, one of MSBA's Advantage Partners . *** Real Estate Development: How the Landscape of SEO Has Changed Law firms, especially big law firms, tend to rely on SEO to market their practices online. The age-old question is: H ow do I get to Page One on Google? The new problem is that Page One of Google is changing. Leveraging search results has always been more of an art than a science and the picture is shifting again. Google's algorithms and search results pages get tweaked from time to time, and it pays to monitor trends, which ...

BANKRUPTCY BULLETIN: District Court’s Order Was Not “Final” for Appellate Jurisdiction Because of the Pending Motion to Dismiss Chapter 12 Case

By David Tanabe posted 04-28-2024
BANKRUPTCY BULLETIN Contributing Author: David M. Tanabe , Winthrop & Weinstine, P.A. In In re Vera T. Welte Testamentary Trust , 96 F.4th 1034 (8th Cir. 2024), the Eighth Circuit Court of Appeals held that the district court’s order was not “final” for 28 U.S.C. § 158(d)(1) because the bankruptcy court still had to (1) rule on the motion to dismiss the chapter 12 case and (2) give preclusive effect to the state appellate court’s decision with respect to the mortgage dragnet clauses and the amounts owed under the promissory notes. In the case, the trust executed mortgages in favor of the lender with dragnet clauses (which ...

Can Generative AI Spur Futures Thinking in Lawyers?

By Mary Warner posted 04-02-2024
I woke from a vivid morning dream recently. In it, my husband and I were experimenting with generative AI (GenAI). I had asked it to create birthday greetings. With every iteration, it spit out a physical birthday card. Meanwhile, my husband’s request was producing modernist floor-to-ceiling curtains. Within seconds, several panels, apparently hung by the AI, created a fabric wall of abstract blue, green, and gold in the room. As I woke, the thought occurred: What if GenAI could be used to create physical objects, not just words, images, or computer code on screens? How would that work? It’s already being used to discover and produce anti-aging ...

BANKRUPTCY BULLETIN: Eighth Circuit Holds Post-Petition, Pre-Conversion Appreciation in Chapter 13 Debtor’s Residence Under Her Control from Commencement Until Conversion Is Property of the Chapter 7 Converted Estate

By David Tanabe posted 03-26-2024
BANKRUPTCY BULLETIN Contributing Editor: Sam Calvert, Attorney at Law In In re Goetz , 2024 WL 998765 (8th Cir. Mar. 8, 2024), the Eighth Circuit Court of Appeals gave bankruptcy 13 debtors reason to be concerned about conversions from chapter 13 to chapter 7. On August 19, 2020, the debtor Machele Goetz (“Debtor”) filed a chapter 13 bankruptcy petition and plan. At that time, she owned a residence worth $130,000 and claimed the full $15,000 homestead exemption under Missouri law. The lender held a roughly $107,000 lien against the residence. Liquidation of the residence on the date of the petition would have resulted in no recovery for the bankruptcy ...

Bankruptcy Bulletin: SCOTUS Holds FCRA Authorizes Civil Relief Against Federal Agency

By David Tanabe posted 03-03-2024
BANKRUPTCY BULLETIN Contributing Author: Stanley Chow University of Minnesota Law School Juris Doctor Candidate, 2025 Judicial Extern to U.S. Bankruptcy Judge Kesha Tanabe In Department of Agriculture Rural Development Rural Housing Service v. Kirtz , 144 S. Ct. 457 (2024), the Justices unanimously rejected the government’s claim to sovereign immunity under the Fair Credit Reporting Act (the “FCRA”). In the underlying case , the plaintiff sued a federal agency, seeking monetary damages for its failure to correct inaccurate information on a consumer credit report. The plaintiff sought relief under the FCRA pursuant to 11 U.S.C. ...

2024 ABA Techshow Recap

By Mary Warner posted 02-27-2024
The 2024 ABA Techshow held at the Hyatt Regency in downtown Chicago kicked off with its annual Start-Up Pitch Competition on Valentine’s Day. Representatives from fifteen legal tech companies gave their pitches, all hoping for the audience’s vote to win the competition. It was apparent from the pitches that generative AI (GAI) was once again going to be the featured topic of the Techshow, only this year the focus was on how to integrate it into legal tech and the practice of law. Interestingly, the start-up that won this year’s competition was AltFee, which is not using GAI but is responding to the workflow changes and efficiencies law firms will see when ...

Bankruptcy Bulletin: Bankruptcy Judge Tanabe held that a computer was exempt as a personal good under Minn. Stat. § 550.37, subd. 4(b), but a snowblower was not.

By David Tanabe posted 02-06-2024
BANKRUPTCY BULLETIN Contributing Author: Nauni Manty , Manty & Associates, P.A. In In re Sand, 2023 WL 7449957 (Bankr. D. Minn. November 9, 2023), the bankruptcy court analyzed the personal goods exemption under Minn. Stat. § 550.37, subd. 4(b) which states, in part: “[h]ousehold furniture, household appliances, phonographs, radio and television receivers of the debtor and debtor’s family, not exceeding $11,250 in value.” The trustee objected to the debtor’s exemption of various household goods and appliances, including a computer, DVD player, printer, DSLR camera, a GoPro camera, snowblower and tools under Minn. Stat. § 550.37, ...

Copy That: How to Manage Law Firm Data Backup

By Mary Warner posted 02-06-2024
This post is from attorney Jared Correia, owner of Red Cave Law Firm Consulting, one of MSBA's Advantage Partners . *** It can’t happen to you until it does. I’m talking about the business disaster that could strike your law firm at any moment: flood, fire, data breach, device breakdown, smoke damage, truck carrying 30 , 000 pounds of bananas careening out of control . . . Well, you get the picture. Because any law firm could be struck by disaster, every law firm should develop and maintain a disaster recovery program. T he primary co mponent o f any disaster ...