Case Roundup

Collateral Estoppel

Raspanti v. Keaty, 5th Cir. 2005

In a Bankruptcy suit the District Court erred in not applying principles of collateral estoppel to a Louisiana Appellate Court's findings on the issue of whether a debt owed by Defendant was for willful and malicious injury. ___________________________

Chapter 11 Administrative expenses keep their status following conversion

US v. Fowler, 9th Cir. 2005

Post-petition employment tax debt incurred as an administrative expense of a Chapter 11 Estate retains its first priority administrative expense status upon conversion to a Chapter 13. ____________________

Bankruptcy laws preempt State laws regarding avoidance of preferences

Sherwood Partners, Inc. v. Lycos, Inc., 9th Cir. 2005

Federal Bankruptcy law has 2 major goals: discharge of a Debtor and equitable distribution of assets. State laws that implicate either of those goals are presumed to be preempted by the Federal Bankruptcy laws. Hence, a State law that gave an assignee for the benefit of creditors (but not individual creditors) the right to avoid a preference was preempted.

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Res Judicata does not require that prior matter was subject of hearing

In re Keaty, 5th Cir. 2005

In a section 523(a)(6) case, the Bankruptcy Court erred by failing to give preclusive effect to a State Court's findings on the grounds that the issue had not actually been litigated because there had been no hearing. There is nothing in the case law defining the term "actually litigated" to require a trial or evidentiary hearing. The requirement that an issue be "actually litigated" for collateral estoppel purposes simply requires that the issue is raised, contested by the parties, submitted for determination by the Court, and determined.