Bankruptcy Law News - U.S. First Circuit
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Before he lost his job in 2002, Robert Murphy was making six figures as the president of a manufacturing company. So, when the Massachusetts father found himself unemployed, he assumed he would be able to find new work. In the meantime, he took on hundreds of thousands of dollars in Parent PLUS loans to pay for his three children's college educations.

Years later, Murphy hasn't been able to find regular employment. He's saddled with $246,000 in student loans, despite paying off $61,000 with money from his retirement fund. And, following years of legal wrangling, Murphy may finally be able to discharge those loans due in bankruptcy, after his debt holder agreed that repayment would be an undue hardship.

Telecom Exec Must Face the IRS Music, 1st Circ. Rules

Summonses must be respected despite seeming changes in the relevant law, the First Circuit said in Frank Gangi v. United States. Gangi, the exec of a telecom company trying to go belly-up, had been trying to squeeze out of complying with IRS summonses that had been sent to his lawyers, his accountants, and his banks. When the IRS smells rotten fish, they usually are on to something.

When it comes to paying taxes, you can run, but you really can't hide -- at least not for long.

Last week, the First Circuit had to determine whether lower courts properly gave post-petition orders, related to environmental law violations and administrative expense priority in a bankruptcy proceeding. The First Circuit, affirming the lower courts, and departing from the Third and Ninth Circuits, found that they did.

First Circuit: Fraud Judgment Means Debt is Nondischargeable

Murphy's Law was working overtime when David Sharfarz started talking to contractors about building an addition to his new home. Sharfarz ended up hiring Peter Goguen. The contract for the job required Goguen to pour the foundation by October 15, 2006, to obtain the necessary town permits, and to complete the project by March 15, 2007.

Goguen lied to Sharfarz on multiple occasions throughout the project, (e.g. saying he applied for permits when he hadn't, demanding — and receiving — money for a worker he never hired). Sharfarz's primary concern through the process was pouring the foundation before the weather turned cold to avoid cracks. The project was delayed (due to the missing permits), the foundation was poured after the weather turned cold, and the foundation — you guessed it — cracked.

Diane Finkle Appointed as Rhode Island Bankruptcy Judge

This just in -- The First Circuit Court of Appeals has appointed a new Bankruptcy Judge.

We've been bringing you news about several vacancies over the past few months, not just in the First Circuit, but across the Circuits. Here's the first one of these vacancies to be filled: On June 8th, Chief Judge Sandra Lynch announced that the Diane Finkle has been chosen to sit as United States Bankruptcy Judge for the District of Rhode Island.

Bankruptcy Judge Vacancy in New Hampshire

Are you a First Circuit bankruptcy attorney looking to move up the ranks? This may be the news you were waiting hear: The First Circuit Court of Appeals has announced a vacancy for Bankruptcy Judge.

The position is for the United States Bankruptcy Court for the District of New Hampshire, and it will be based out of Manchester, New Hampshire.

Court Refuses Bankruptcy Attorney's Fee Request for Being Excessive

In a Chapter 13 bankruptcy, court schedules can lay out the amount of money that an attorney may be awarded. But there are limits to a bankruptcy attorney’s fees in a Chapter 13 bankruptcy, as we see in a recent First Circuit Court of Appeals decision.

In this case, a bankruptcy attorney challenged the fees he was awarded in a Chapter 13 bankruptcy proceeding, claiming that the fees were too meager.

Apply Now: Rhode Island Bankruptcy Judge Vacancy

If you’re a distinguished Rhode Island Bankruptcy lawyer, you may be interested in knowing that there is a judgeship vacancy, and that applications are now being accepted. In a press release, Chief Judge Sandra Lynch of the First Circuit Court of Appeals announced the creation of a Bankruptcy Merit Selection Panel. The Panel will screen and review the qualifications of applicants for the Bankruptcy Judge vacancy left by the Honorable Arthur N. Votolato.

Judge Votolato has served on the Bankruptcy Court in the District of Rhode Island since 1968. Judge Votolato, a 1956 graduate of Boston University School of Law, served as Bankruptcy Court Judge after a distinguished career in Bankruptcy, where he became Chief Judge of the First Circuit Bankruptcy Appellate Panel in 1996.

Judicial Conference Adopts Bankruptcy Courtroom Sharing Policy

Bankruptcy judges will soon feel America’s proverbial belt-tightening in the courthouse.

This week, the Judicial Conference of the United States adopted a courtroom sharing policy for bankruptcy judges in new courthouse and courtroom construction. In court facilities with three or more bankruptcy judges, one courtroom will be provided for every two bankruptcy judges. In those facilities with an odd number of bankruptcy judges, the number of courtrooms allotted will remain at the next lower whole number.

While the courtroom sharing policy will reduce the number of courtrooms constructed, government reports indicate that reduced construction will not impair access to bankruptcy courts.

In re Net-Valazquez, 09-1816

District court's holding that a creditor's garnishment of funds was avoidable under 11 U.S.C. section 547(b) affirmed

In re Net-Valazquez, 09-1816, concerned a challenge to the district court's affirmance of a bankruptcy court's judgment in favor of a bankruptcy trustee, holding that a creditor's garnishment of funds was a preferential transfer of estate property avoidable under 11 U.S.C. section 547(b).