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New Student Loan Consumer Group is Taking Initiative

December 3, 2018

A new student loan consumer watchdog group is taking initiative to help and protect student borrowers in the absence of government action.  This non-profit consumer group is led by people who quit the Trump administration Consumer Financial Protection Bureau and hope to serve as a check on the student loan industry.  Known as the Student Borrower Protection Center, its mission is to expand borrower protections and oversight of the $1.5 trillion student loan market.  The new center plans to encourage states and cities to step up enforcement actions against loan-servicing companies, debt collectors, for-profit schools and private student lenders. The group also plans to do advocacy work in states considering legislation that steps up oversight of student loan servicers and other parts of the industry, and lobby for a borrower bill of rights in California.  For more information or help with your student loan, please feel free to reach out to us. For more detail on this new consumer group, please review this article.

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The Small Business Reorganization Act of 2018 features Affordable Price Points & Expedited Process

November 30, 2018

The Small Business Reorganization Act of 2018 features affordable price points and expedited process for small businesses with a debt load of $2.5 million or less.   The goal is to encourage and facilitate the rebuilding and retooling of small businesses in our turbulent yet very entrepreneurial economy.  The proposed law provides incentives for owners who want to keep ownership stakes and protections for creditors who want to be repaid quickly and reliably.  The bill would cut the cost of bankruptcy by requiring companies to file a repayment plan within 90 days and also eliminating half of the two-step process for judges to approve the plan and disclosure statement.  The bill would also cut costs by eliminating the automatic appointment of an unsecured creditors committee and make it harder for creditors to object to repayment of debt with future profits over a period of up to five years.  Existing rules require owners to repay all existing debts in full if they want to remain in control and keep their equity.  The bill would also make the threshold for so-called “preference” lawsuits against creditors $25,000 for return of monies paid to them within 90 days of the bankruptcy filing and redistribution pro rata among all the creditors as a group.   If you are a small business in financial distress or need of out-of-court work-out or bankruptcy restructuring advice, we would be happy to help you.  For more details on the proposed Act, please review the following article.



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ITT Tech Student Loans Settle in Bankruptcy versus other Government Loans

November 29, 2018

ITT Tech student loans settle in bankruptcy and will be paid out assuming that ITT’s bankruptcy estate has sufficient funds. The settlement that will erase nearly $600 million that 750,000 students owed ITT Technical Institute. The agreement will also refund $3 million that students paid the for-profit chain. The students asserted a $1.5 billion claim against the company for consumer-protection violations and breach of contract, and asked for status to cover anyone who attended ITT Tech between 2006 and 2016.  This is in contrast to federal government loans that are being handled through the Education Department which is loathe to enforce enactments that help student borrowers who were defrauded by for-profit colleges.  One such statute known, as borrower defense to repayment, wipes away federal loans for students whose colleges used illegal or deceptive tactics to get them to borrow money to attend.  For more information on whether your student loan is eligible for discharge or settlement in bankruptcy, please fee free to contact us.  For more details on this particular settlement, please review the following article.


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Bitcoin Mining Pioneer GigaWatt Seeks Bankruptcy Protection

November 26, 2018

Bitcoin mining pioneer, GigaWatt, seeks Chapter 11 bankruptcy protection in Spokane, Washington.  The filing is the latest twist in an entrepreneurial saga stretching back to the early days of bitcoin and may be connected to efforts by three of the company’s majority shareholders to sell GigaWatt.  One of its co-founders, David Carlson, a former Microsoft engineer, began mining bitcoin as a hobby in 2012 and was among the first miners to tap the cheap hydropower of Central Washington. In 2013, Carlson built what was then the world’s largest bitcoin mine in downtown Wenatchee and later expanded into hosting services for other miners.  Bitcoin and other cryptocurrencies are produced by solving ultra-complicated math problems with powerful computer servers. Those computers consume huge amounts of power — a single bitcoin today can cost around $2,500 in power — which is why Carlson came to Central Washington, where power sells for less than a quarter of the national average.  As the price of Bitcoin has declined, however, so has the utility for even efficient mining services, although the Port of Douglas County would love for the project to be resuscitated.  If you deal in cryptocurrency and have any questions about salvaging your business via restructuring or bankruptcy, please do not hesitate to give us a call.  For more details on this particular bankruptcy filing, please review the following article from the Seattle Times.

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Update: Attention Brides! David’s Bridal has filed for Chapter 11 Bankruptcy

November 15, 2018

A Chapter 11 bankruptcy case has been filed in Delaware by Conshohocken PA based wedding gown retailer David’s Bridal Inc.  A Chapter 11 plan was filed with its Chapter 11 petition, so that this “pre-packaged bankruptcy case” should go through a speedier approval process than a regular bankruptcy case, as all major creditors have already agreed to the plan.  According to a company spokesperson, brides will hopefully still be able to get their wedding attire in a timely fashion.  Like many of its retail peers, David’s Bridal is plagued by a heavy debt load and a consumer shift to shopping online.  However, unlike the dozens of retailers that filed for bankruptcy and liquidated in recent years, David’s Bridal plans to emerge from a speedy court process with its stores still intact and continue its day-to-day business.  If you have any questions about this bankruptcy or the bankruptcy process, we would be happy to help you out.  For more information on the Chapter 11 details, please see the linked Chapter 11 petition, and also review the following article.



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Can the Taste of Cheese be Copyrighted?

November 14, 2018

Can the taste of cheese be copyrighted? The European Union’s highest court has ruled: No.  A Dutch cheese company tried to argue that the taste of its spreadable cheese could be copyrighted.  The EU Court of Justice found that taste cannot be protected by law because it is “an idea” not an “expression of an original intellectual creation.”  Whether in Europe or the U.S., copyright protection applies only to expression of an idea in a tangible medium, but it does not protect the actual underlying idea.  For example, a recipe book contains generic ingredients that are not copyrightable as mere ideas.  However, when these ingredients are arranged and expressed in a manner that shows some type of original judgement, namely, in a recipe, then copyright protection can extend to the recipe and the collection in a book.  The author’s subjective idea becomes objective when expressed in the recipe book.  However, a person’s experience of taste when eating cheese is subjective and varies, such that it is not copyrightable property of the company.  On the other hand, the recipe for the cheese is a protectable trade secret if reasonable steps are taken to keep it secret and it is indeed kept secret!  We would be pleased to help you protect your product.  Please feel free to reach out, and for more information, please see the following article.


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WBLA’s Inaugural Trek to NY Law Firms!

November 11, 2018

I am so excited to help launch the Wharton Business Law Association’s first trek to visit New York law firms! Thanks and kudos to my sister network Women Owned Law hostess attorneys — Wendy Schwartz of Binder & Schwartz, Nancy Mertzel of Mertzel Law PLLC and Helene Pangalos of The Law Office of Helene Pangalos — who will be discussing their practice areas, including, litigation and transactional work in the areas of financial services, healthcare, construction, government contracting, copyright, trademark, real estate and bankruptcy law.


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SEC launches “FinHub” for Cryptocurrency, Blockchain, AI & Tech Companies

November 6, 2018

The SEC launch of its “FinHub” or Fintech Hub is a recent breakthrough for all innovators who engage in the Cryptocurrency, Blockchain, AI & Tech spaces.  It will bring the SEC’s existing services to a single access point and provide an easier way for companies to communicate with the public, as well as a platform for streamlined compliance.  Please feel free to reach out to us with any questions about this development and review this article for more detail.

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Is it legal for Banking Guidelines to be considered actual law by Regulators? No.

November 6, 2018

The Bank Policy Institute and American Bankers Association has filed a petition asking the Trump administration to write a rule stating that bank examiners won’t punish firms for violating informal voluntary policies known as “guidance.”  The petition is a gambit in a yearlong fight over guidance documents used by regulators to punish or threaten to punish banks.  An FDIC spokesman confirmed that “ supervisory guidance does not have the force or effect of law.”  If you have any additional questions, please feel free to reach out, and for more details on this petition, please review the following article.

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Facebook, Google Face Billions in New Taxes in the U.K. & Across Asia, Latin America

October 30, 2018

There is now a growing international trend to impose revenue based taxes on technology giants rather than their profit.  The U.K. just announced a 2% tax on revenue.  South Korea, India and other Asian-Pacific countries are exploring these taxes, as are Mexico, Chile and Latin American countries.  These taxes seek to capture revenue from digital services sold by foreign global companies in a given country.  The U.S. is concerned over these tax impositions that are affecting American companies overseas.  Please feel free to reach out to us from more information on the effect of these taxes on your business, and see this article.

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