Groups Reload for More Lobbying on Reconciliation Bill
Groups that fought the $39.7 billion deficit-reduction reconciliation bill will get another chance to lobby against it now that Democrats are insisting on a roll call vote for the House to approve changes the Senate made Wednesday, CongressDaily reported today. The Senate stripped several provisions before approving the overall bill, 51-50, with Vice President Cheney casting the tie-breaking vote and sending it back to the House. Without objection, the House could have approved the changes by unanimous consent during today's pro forma session, but House Minority Leader Pelosi said Democrats would insist on a recorded vote.
With the House already in recess, Speaker Hastert hoped to avoid calling members back for a vote. But delaying a vote until the House reconvenes Jan. 31 would mean that funds for some programs would dry up temporarily, so he must decide whether to bring lawmakers back earlier. The House narrowly approved the reconciliation bill Monday, 212-206, so switching just a handful of votes might change the outcome. The extra time would also give members more time to read the 774-page bill, meaning some members on the fence would have more time to find provisions they do not like.
U.S. LEADING ECONOMIC INDICATORS UP IN NOVEMBER
A widely watched measure of future economic activity rose in November as fewer people filed for jobless benefits, suggesting that the nation's economy may grow moderately into the spring, a private research group said Thursday, the Associated Press reported today. The Conference Board said its Index of Leading Economic Indicators, which tries to gauge future economic growth, rose 0.5 percent in November.
Much of last month's gains were tied to a drop in applicants seeking unemployment benefits. While the outlook signals that the economy will grow, the report's authors warned of rising costs tied to higher energy prices. "High and potentially rising energy prices are one consideration in this outlook," said Ken Goldstein, labor economist at The Conference Board. "Rising costs and questions about whether they will be matched by price hikes are also a factor in how fast the economy grows this spring." The Conference Board's measure of current economic activity, the coincident index, rose 0.2 percent in November, following a 0.2 percent increase in October.
COMMENTARY: CALPINE TOOK LONG ROAD INTO BANKRUPTCY
Calpine Corp.'s convoluted descent into bankruptcy, culminating in a chapter 11 filing late Tuesday night, began when the future still looked bright for the power merchant, The Associated Press reported yesterday. Emboldened by its rapidly rising profits and stock price in 2001, Calpine launched a debt-laden expansion aimed at capitalizing on an apparent power shortage that had turned electricity into a high-priced commodity.
The San Jose, Calif.-based company doubled in size, leaving it with 3,300 employees and 92 power plants in 21 states and Canada with enough capacity to provide electricity to 28 million homes. But market conditions have shifted radically during the past four years amid plunging prices for electricity and climbing costs for natural gas - the fuel that Calpine relies upon to run most of its environment-friendly power plants. As it stands now, Calpine's expansion seems pointless. The company's fleet of power plants has been operating at only 45 percent of capacity, making it difficult to generate enough money to repay debts listed at $22.5 billion in Calpine's bankruptcy filing. With lenders determined to be repaid, the stage is now set for a tense legal battle over Calpine's $26.6 billion in assets as the company navigates through the ninth-largest bankruptcy in U.S. history. Click here for the full story.
COMMENTARY: THE ROAD AHEAD FOR GM
General Motors hasn't collapsed. But confidence in GM has. The company's shares have swooned to new 23-year lows, causing its dividend yield to climb above 10 percent for the first time in its history, the Wall Street Journal reported today. GM's market capitalization stands at just $11.2 billion, even though GM reported having $19.2 billion in cash at the end of the third quarter. These numbers mean the market believes, as Dow Jones Newswires's Maxwell Murphy wrote, that GM either will have to slash its dividend, file for bankruptcy or do both. Indeed, speculation mounts that GM is headed for chapter 11, although late yesterday UBS raised its investment rating on the stock from "reduce" to "neutral."
The real question, though, is not whether GM will file for bankruptcy, but whether it should file. There's a case to be made that, despite the $19.2 billion in the corporate piggy bank, GM should stop publicly pooh-poohing the notion. The reason: Bankruptcy proceedings might be the fastest way to force the truly tough decisions that could fundamentally change -- and save -- the company. Evidence abounds that GM management and the United Auto Workers union, the two major protagonists in this drama, remain wedded to pursuing incremental improvements. And this is despite losing $4.8 billion on its North American auto operations in the first nine months of this year during one of the best car markets in history, debt ratings that have plunged into junk status, and a market cap 1/15th that of Toyota's. Click here for the op ed piece.
TENNESSEE BANKRUPTCY JUDGE TO RETIRE
On the day after his 65th birthday next April, Judge William Houston Brown will leave his spot on the U.S. Bankruptcy Court bench in Memphis, Tenn., putting a career of nearly 19 years behind him for everything from speaking, writing and mediation to skiing, The Commercial Appeal reported today. "All of the practitioners will be sorry to see him retire," said Wendy Smith, a lawyer with Husch & Eppenberger and head of the bankruptcy section of the Memphis Bar Association. Her colleagues gave the former ABI director good ratings, too. He had the fourth-highest score among 71 judges included in the MBA's judicial evaluation survey. His top score, 9.5 of a possible 10, came on knowledge of the law, according to the 99 lawyers who rated him. Click here for the full story.
UPDATE TO MINI-RULES BOOK
The publisher of the 2006 edition of the Mini-Rules book, AWHFY Publishing, has issued an update to the book, which may be downloaded here. The one-page update label should be placed in your 2006 Mini-Rules on the last Note page at the back of your book. The label will update your Interim Rules with the most current amendments. We will apprise you of any additional updates as the publisher makes them available.
ANALYSIS ON CONSUMER PROVISIONS OF BAPCPA
ABI Member Michael Barnett (Michael Barnett, PA; Tampa, Fla.) has prepared an analysis of the consumer provisions of BAPCPA, updating it with case law as becomes available. Click here to view the analysis.
REGISTER NOW FOR ABI’S 24TH ANNUAL SPRING MEETING
Join ABI in Washington, D.C., for its 24th Annual Spring Meeting, April 20-23, 2006. Top bankruptcy judges and nationally acclaimed practitioners will convene in the Nation's Capital for four days of networking, CLE/CPE programming and headliner entertainment. Don't miss a special Friday morning plenary session where Kathleen Ligocki, president and CEO of Tower Automotive, will discuss the problems U.S. manufacturers face today. Political pundit Mort Kondracke is the Friday luncheon program keynote speaker. In addition, this year's program features the Tenth Annual Great Debates on hot topics and, among others, the following educational panels:
- New World of International Insolvencies: Chapter 15 and Beyond
- Professional Compensation in the Post-BAPCPA Environment
- Implementing BAPCPA: More Rules and New Roles
- Judges Roundtable - Hot Splits in the Circuits
- Anatomy of a Health Care Insolvency
- Turnarounds after BAPCPA: Should We All Become Liquidators?
- Asset Protection after BAPCPA: Testing the Limits
- Consumer Lawyer vs. Client: The Ethics of Disclosure after BAPCPA
- Business: Ethics and the Plan Process - When Is the Client a Fiduciary, and What Does That Mean?
You can also participate in numerous Educational Committee Sessions on Friday and Saturday, April 21 and 22. Get involved in ABI's committees and earn CLE credit! Register early and save $80.
Register today and earn up to 19 hours of CLE credit!
Today's Featured Committee Meeting: Ethics/Professional Compensation/Investment Banking (joint), Saturday, April 22, 2006 at 9:30 a.m.
"The Three Deadly Ds -- Disclosure, Disinterestedness & Disgorgement: How to Get What You Earned and Keep What You Got!" The "world of compensation" has radically changed for bankruptcy professionals in the last year. From the EToys decision, we've learned that new, and even greater, care must be taken by court-appointed professionals (and officers of the debtor) in making the required disclosure of "connections" under Bankruptcy Rule 2014. As a result of BAPCPA, investment bankers (and their counsel) must now determine how they can pass the "disinterestedness" test in order to qualify for retention. Finally, in light of decisions such as In re Commercial Financial Services, Inc. and numerous recent amendments to the Bankruptcy Code that increase the likelihood of administratively insolvent estates, the Specker (Specker Motor Sales v. Eisen, that is) of disgorgement of already-paid professional fees has raised its ugly head. In this joint presentation, a distinguished panel will examine and provide useful guidance as to these and other issues of concern for attorneys, investment bankers and other bankruptcy professionals. It will be a program you can't afford to miss!
BLOG ON BAPCPA
ABI World is now home to a blog on the latest case law interpreting the bankruptcy amendments. Created by David L. Rosendorf, ABI member and a shareholder at Miami’s Kozyak Tropin & Throckmorton, P.A., the ABI BAPCPA Blog provides regular commentary, analysis and an opportunity for you to post comments. Check out the blog here, and feel free to weigh in.
UPDATED FOR THE NEW LAW: WHEN WORLDS COLLIDE: BANKRUPTCY AND ITS IMPACT ON DOMESTIC RELATIONS AND FAMILY LAW, THIRD EDITION
Divorce and bankruptcy are alike in that each attempts to provide a "fresh start," but the laws are often in conflict. This resource, now updated to include BAPCPA changes, was developed for an ABI educational program to help family court judges better identify and deal with bankruptcy issues, such as the impact of the automatic stay, the power of the courts to enjoin state courts, property of the bankruptcy estate, the impact of the bankruptcy discharge on alimony, child support, maintenance and property settlements, post-petition divorce actions and exempt property. Appendices feature relevant sections of the Bankruptcy Code, a list of cases and articles on the topic, and a directory of bankruptcy judges and bankruptcy court clerks. Softbound, 120 pages. Order today!
Member: $22 Non-member: $27
NEW ON-DEMAND CLE: BEST OF MID-ATLANTIC WORKSHOP 2005
“Anything but Bankruptcy: ABCs, Receiverships & Other Alternatives” will be held live on Jan. 18, 2006, at 2 p.m. EDT. This “Best of ABI” program covers winning strategies involving state and federal receiverships, assignments for the benefit of creditors, out-of-court workouts and more. 90 minutes, $95. Click here for more information.
From publishing opportunities to committee involvement, ABI offers many options for members to raise their professional profiles. Click here for more opportunities.
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