4th of July Round-up!

4th (of July) Circuit

Fairchild Dornier GMBH v. Official Comm. of Unsecured Creditors (06/27/06 - No. 05-1930)

The bankruptcy court's recharacterization of a sale of parts is affirmed where: 1) recharacterization of claims is within the broad powers of a bankruptcy court; 2) recharacterization exists separately from the court's disallowance and equitable subordination powers; and 3) the factual determinations were not clearly erroneous and supported the court's recharacterization.

7th Circuit

Summers v. UAL Corp. (06/28/06 - No. 05-4005)

Dismissal of class action against administrator of an Employee Stock Option Plan is affirmed: administrator did not act imprudently by failing to diversify in the face of the decline of UAL stock and the company's eventual bankruptcy.

8th Circuit

DeBold v. Case (06/26/06 - No. 05-3401)

In a bankruptcy case involving the allocation of settlement proceeds from a lawsuit between former partners of a failed joint venture, a decision adverse to a bankruptcy trustee is affirmed over claims that the BAP exceeded its scope of review by making findings of fact not found by the bankruptcy court and erred in its conclusions of law regarding an individual's entitlement to the settlement proceeds.

11th Circuit

Ajaka v. Brooksamerica Mortgage Corp. (06/29/06 - No. 05-12105)

Summary judgment for defendants in a suit claiming violations of the Truth in Lending Act is reversed where there is a question of material fact as to whether plaintiff had the motivation and intent to manipulate the judicial system such that judicial estoppel of his claims was appropriate.

Bracewell v. Kelley (06/30/06 - No. 05-11951)

Exclusion of a federal payment for crop loss from a bankruptcy estate when the loss occurred before the creation of the estate, but the law creating the right to the payment was enacted afterwards, is affirmed where: 1) there was no legal or equitable right to the payment at the moment of creation; and 2) the assistance did not constitute proceeds from the property of the estate.