People who handle cases in all kinds of civil courts, whether state, federal, or both, get an odd feeling when they wander into a special kind of civil court — the U.S. bankruptcy court. The oddness comes partly from the strange ways bankruptcy law handles disputes. Often, the merits of a claim seem to take a
fraudulent transfer
“No-Action” Clause Barred Suit by Holders of Notes, Eleventh Circuit Holds
By Barry Barnett on
When a firm borrows money by selling an issue of bonds or notes to the public, it does so under an "indenture" that sets out the loan terms and creates a trust in favor of the buyers. The indenture also names a trustee to run the trust for the benefit of people who acquire the…
Creditor Inherits Wind, Fifth Circuit Holds
By Barry Barnett on
Two makers of spray-tanning machines, Mist-On and Laughlin Products, sued a customer, Nouveau Body & Tan, for saying ugly things about their devices.
Bad move.
Nouveau struck back by charging Mist-On with selling it bad spray-tanners. Nouveau won a judgment against Mist-On and its president, Thomas J. Laughlin, for more than $1 million. They couldn't pay, and Mr. Laughlin…