The National Conference of Bankruptcy Judges is back this year in Indianapolis with a hybrid format for in person and virtual attendees. About 750 in person attendees helped to prop up the local hospitality industry. Every year the conference kicks off with the Broken Bench presentation, an overview of hot issues in the bankruptcy world. This year's program was done in a Jeopardy format with host Chief Judge Pamela Pepper (E.D. Wis.). This was a fun presentation of bankruptcy trivia. While this post may not help your day to day practice, I hope you enjoy it.
In the section introducing the contestants, we learned that Demetra Liggins once struck up a conversation with Tyne Daly on a New City bus. Nancy Rapoport is a competitive ballroom dancer. She experienced a wardrobe malfunction when her helper failed to secure the clasp on her gown and it started slipping down while she danced. Judge Catherine Furay (Bankr. W.D. Wisc.) both collects and designs bobbleheads.
Sex and Religion
One of the jeopardy categories was sex and religion. One question was what should teenagers do and what bankruptcy judges can do in an appropriate case? Abstain. What is illegal except in Stockholm but required in Chapter 11? Solicitation. What must debtors provide and young people should use? Adequate protection. What do people seek in church and debtors can use to reclaim exempt property encumbered by liens? Redemption.
Famous Debtors
Another category was famous debtors. MC Hammer was a batboy for the Oakland As before he became a famous rapper and later a Chapter 11 debtor. Cindy Lauper filed bankruptcy and was a waitress at IHOP before becoming a Grammy-winning artist. NFL star George Foreman filed bankruptcy before the started selling his famous grills. Filmmaker Francis Ford Coppola filed bankruptcy not once but twice.
Abe Lincoln filed bankruptcy in 1833 after his mercantile store failed and his partner died. He was required to surrender his horse and pay back his creditors over 17 years. Charles Dickens's father was confined to Marshalsea Debtor's Prison. He remained confined until his mother died and he received enough money to pay his debts.
The Pittsburg Penguins are the only sports franchise to have filed bankruptcy twice.
Brick and Mortar
In the questions on bricks and mortar, we learned that ToysR'Us is returning to the U.S. in Macy's stores. They had previously re-opened two locations which had to close due to covid. However, they retain a $2 billion foreign and ecommerce operation.
Some communities are seeking to convert malls to affordable housing although they face zoning restrictions.
In 2010, Blockbuster had 9000 stores in all 50 states. However, by the late 2000s Blockbuster began losing its grip on the retail rental market. In 2019, its next to last store, located in Australia closed. There is still one store remaining in Bend, Oregon which survived covid by renting itself out as an Air BnB for 90s themed parties.
Home Depot and Lowe's are two big box retailers which have not only survived but have thrived during covid.
Ethics
Wizenberg v. Wizenberg (In re Wizenberg), 838 F. App’x 406 (11th Cir. 2020), involved an adversary proceeding between two brothers. The pro se Debtor (who was a lawyer) was sanctioned in the amount of $9,850 under 28 U.S.C. Sec. 1927 for shushing opposing counsel and filing lengthy and superfluous documents. Among other things, he filed a 69-page motion to dismiss the complaint, a 153-page motion for reconsideration of the bankruptcy court’s order denying him summary judgment, and a 326- page opening statement (including exhibits) prior to the trial on the adversary complaint. His filings also included a "pointless" Haiku poem which read “All know: talk is cheap; Liars can claim anything; No evidence?! Balk!”
By now, my lawyers have heard about the Texas lawyer who appeared in a Zoom hearing with a cat filter. The judge may have been purr-turbed. The attorney failed the duty of competence (including technical competence under Model Rule 1.1, comment a, but did show candor to the court when he told the court, "I'm not a cat." This was not part of the program, but I did hear the story of an attorney who fell asleep on his couch during a hearing and missed the opportunity to object to questions asked of his client.
When a lawyer says, "with all due respect," they mean "with all due contempt." I made this mistake as a young lawyer and received an immediate dressing down from a U.S. District Judge. I have not used the phrase since then.
Statistics
During 2020, Delaware led the nation with 1,660 chapter 11 filings. Close behind was the Southern District of Texas with 1,363.
In 2020, Louisiana and Massachusetts each saw a 42% drop in filings./
Notable and Quotable
Medical bills outweigh all other types of debt in bankruptcy combined.
Sen. Elizabeth Warren has stated that for every family that files bankruptcy, there are fifteen others who could benefit from bankruptcy.
St. John's University School of Law has filed an amicus brief in every bankruptcy Supreme Court case since 2006.
Promesa is Spanish for promise and is also the name of the law allowing Puerto Rico to restructure its debts.
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