Credit Slips

What Could Go Wrong When a DIP Maintains a Large, Uninsured Deposit Account at Silicon Valley Bank?

03/10/2023 Credit Slips News & Comments

You gotta feel for BlockFi customers. First, they find themselves creditors in BlockFi's bankruptcy. And now they've found out that BlockFi had a large, uninsured deposit...at Silicon Valley Bank. Yup, it seems that BlockFi had $227 million in a money market deposit account at SVB. (The UST refers to it as a "money market mutual fund," but that cannot be right, or it wouldn't be at SVB or have any insurance.

Wither Student Debt Cancellation? Conservative Justices Showed Determination but a Lack of Conviction

03/01/2023 Credit Slips News & Comments

[by Dalié Jiménez and Jonathan Glater]

The Texas Two-Step's New Key

02/21/2023 Credit Slips News & Comments

In the wake of the Third Circuit's LTL Management decision many commentators wrote off the Texas Two-Step as dead. Turns out it's not, it's just playing out in a different key with a new filing in SDTX. On Feb. 13, Tehum Care Services, Inc. filed for bankruptcy in the Southern District of Texas. The Tehum story starts with a Delaware corporation called Corizon Health, Inc., which provided prison health care services. Corizon faced substantial exposure (perhaps $88 million) on professional liability claims.

Job Opportunity -- Executive Director of National Consumer Bankruptcy Rights Center

02/17/2023 Credit Slips News & Comments

With Tara Twomey's selection as the new head of the Executive Office of U.S. Trustee, the National Consumer Bankruptcy Rights Center (NCBRC) is seeking a new director. The NCBRC helps shape consumer bankruptcy law, as it did for many years under Twomey's leadership. This is an opportunity for someone else to do the same.

Debt-based driving restrictions: new resources

02/06/2023 Credit Slips News & Comments

Professor Kate Elengold and UNC Law 2L Michael Leyendecker have just posted very useful reports for no charge on the Social Science Research Network.

The New Usury

02/03/2023 Credit Slips News & Comments

I have a new paper up on SSRN. It's called The New Usury: The Ability-to-Repay Revolution in Consumer Finance. It's a paper that's been percolating a while--some folks might remember seeing me present it (virtually) at the 2020 Consumer Law Scholars Conference, right as the pandemic was breaking out. Here's the abstract:

#PublicDebtIsPublic and #DebtCeilingIsStupid

01/31/2023 Credit Slips News & Comments

What could possibly trigger me enough to break a two-year blogging hiatus? A sudden burning desire to consider the difference among budget accountability, debt accountability, and the inane, moronic, irrational, exploding human appendix ****show that is the debt ceiling.

Postpetition Asset Sales in Chapter 13s--Modification, Not Estate Property

01/26/2023 Credit Slips News & Comments

Debtors selling houses during a chapter 13 continues to cause conceptual problems for the courts. A recent decision, In re Marsh, from Judge Fenimore in Kansas City is an example. (Hat tip to Bill Rochelle for flagging this decision in his DailyWire column from the American Bankruptcy Institute ($).

Biden DOJ's Excellent Pick to Head USTP

01/18/2023 Credit Slips News & Comments

The Department of Justice has announced Tara Twomey as the next head of the U.S. Trustee Program (USTP). This is an outstanding selection. I will leave her impressive biographical details to the DOJ press release, which you really should read. We here at Credit Slips would have added that she is a former guest blogger for us (which is probably why we are not allowed to write DOJ press releases).

Impact of the Illinois Predatory Loan Prevention Act

01/15/2023 Credit Slips News & Comments

In 2021 Illinois passed its Predatory Loan Prevention Act (PLPA), which imposes a 36% military APR (MAPR) cap on all loans made by non-bank or credit union or insurance company lenders. Not surprisingly, the law has not been popular with higher cost lenders who either have to change their offerings, cease doing business in Illinois, or figure out some way to team up with a bank that won't run afoul of the law's anti-evasion provision.

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