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Secured Lender's Loss of Possessory Lien Affirmed
The U.S. Bankruptcy Appellate Panel (“BAP”) for the Eighth Circuit held on March 25, 2013, that a lender “lost its possessory lien when it turned the Debtor's account funds over to the Trustee without first seeking adequate protection.” In re WEB2B Payment Solutions, Inc., __ B.R. 2013 __, 2013WL 1188041, *5 (8th Cir. B.A.P. March 25, 2013) (emphasis added). Affirming the bankruptcy court's granting of summary judgment to the trustee, the BAP stressed that “a possessory lien is, by definition, released when possession of the collateral is relinquished.” Id. at *3.
Relevance
Trustees and Chapter 11 debtors in possession routinely ask secured lenders to turn over, if not to permit the use of, encumbered cash accounts ' here, a cash deposit account encumbered by a contractual lien. The Bankruptcy Code (“Code”) explicitly provides for mandatory “adequate protection” when a secured lender does not consent to the use of its collateral (' 363(e)); or when a secured lender's lien will be primed (' 364(d)). Code ' 361 gives examples of “adequate protection,” including “periodic cash payments” or “an additional or replacement lien.” Secured lenders, for example, are entitled to be “adequately protected” against any erosion in the value of their collateral. United States Sav. Ass'n. v. Timbers of Inwood Forest Assocs., 484 U.S. 365, 370 (1988); “'Adequate protection' is a term of art in bankruptcy practice ' ; in short, it is a payment, replacement lien, or other relief sufficient to protect the [secured] creditor against diminution in value of its collateral during the bankruptcy.” In re SCOPAC, 624 F.3d 274, 278 n.1 (5th Cir. 2010).
Yachts, Jets, Horses & Hooch: Specialized Commercial Leasing Models
Defining commercial real estate asset class is essentially a property explaining how it identifies — not necessarily what its original intention was or what others think it ought to be. This article discusses, from a general issue-spot and contextual analysis perspective, how lawyers ought to think about specialized leasing formats and the regulatory backdrops that may inform what the documentation needs to contain for compliance purposes.
Hyperlinked Documents: The Latest e-Discovery Challenge
As courts and discovery experts debate whether hyperlinked content should be treated the same as traditional attachments, legal practitioners are grappling with the technical and legal complexities of collecting, analyzing and reviewing these documents in real-world cases.
Identifying Your Practice's Differentiator
How to Convey Your Merits In a Way That Earns Trust, Clients and Distinctions Just as no two individuals have the exact same face, no two lawyers practice in their respective fields or serve clients in the exact same way. Think of this as a "Unique Value Proposition." Internal consideration about what you uniquely bring to your clients, colleagues, firm and industry can provide untold benefits for your law practice.
Risks and Ad Fraud Protection In Digital Advertising
The ever-evolving digital marketing landscape, coupled with the industry-wide adoption of programmatic advertising, poses a significant threat to the effectiveness and integrity of digital advertising campaigns. This article explores various risks to digital advertising from pixel stuffing and ad stacking to domain spoofing and bots. It will also explore what should be done to ensure ad fraud protection and improve effectiveness.
Turning Business Development Plans Into Reality
This article offers practical insights and best practices to navigate the path from roadmap to rainmaking, ensuring your business development efforts are not just sporadic bursts of activity, but an integrated part of your daily success.