Bankruptcy Code – Consumer Financial Services Watch

Upcoming Amendments to Bankruptcy Rule 3002 to Impact Bankruptcy Filing Practices for Mortgagees

Aug 09 2017

By: Phoebe S. Winder, Ryan M. Tosi, David A. Mawhinney

Effective December 1, 2017, certain amendments to the Federal Rules of Bankruptcy Procedure (“the Bankruptcy Rules”) recently adopted by the Supreme Court will impact the allowance of secured claims in bankruptcy. Below, we focus on the amendments to Bankruptcy Rule 3002, which will serve to:

Clarify that Rule 3002 applies to secured claims in cases pending under chapters 7, 12, or 13 of the Bankruptcy Code.

Shorten the deadline for filing proofs of claim to seventy (70) days after the bankruptcy filing.

To read the full alert, click here.

Balancing Act: Supreme Court Rules That Filing a Proof of Claim for Stale Debt Does Not Violate the Fair Debt Collection Practices Act

May 25 2017

By: Phoebe S. Winder, Andrew C. Glass, Gregory N. Blase, Sean R. Higgins, David A. Mawhinney, Theresa A. Roozen, and Brandon R. Dillman

The U.S. Supreme Court has held that the filing of a proof of claim in bankruptcy proceedings with respect to time-barred debt is not a “false, deceptive, misleading, unfair, or unconscionable” act within the meaning of the Fair Debt Collection Practices Act (“FDCPA”) when there continues to be a right to repayment after the expiration of the limitations period under applicable state law. The Court’s decision in Midland Funding, LLC v. Johnson [1] resolved a split among the federal courts of appeal about the application of the FDCPA to proofs of claim in bankruptcy proceedings. While the decision is favorable for creditors, applicable state law (Alabama, in this case) played a key role in the Court’s conclusion that the creditor held a “claim” under the Bankruptcy Code. Creditors must be aware of and review the relevant state law in the jurisdiction of collection to determine whether the filing of a proof of claim could be deemed false, deceptive, or misleading.

To read the full alert, click here.

Tag:Bankruptcy Code