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Tampa Bankruptcy Law Blog

Borders granted extension to plan Chapter 11 bankruptcy exit

  • 03
  • June
    2011

The bookstore giant Borders Group Inc was granted an extension by a bankruptcy judge on Thursday to continue to put together its plan to exit Chapter 11 bankruptcy. Borders asked for an extension of 120 days in order to continue to negotiate for the sale of its stores. An attorney for Borders told the judge on Thursday that the market for selling its stores is much better than it was a few weeks ago. According to Reuters, the attorney told the judge that the company had received offers to buy some or all of the stores from multiple parties.

According to Reuters, Borders is currently negotiating to sell its remaining stores still in operation to a private equity firm, the Gores Group. If Borders was not granted the extension, it had until June 16 to come up with an exit plan. If Borders did not come up with an exit plan by June 16, other groups would be allowed to come up with a plan for reorganization or to purchase Borders.

Verizon repeatedly sent bills to deceased woman

  • 02
  • June
    2011

An example of a person being called by creditors for a debt they don't actually owe was written about in a recent column in the Los Angeles Times. The column by David Lazarus discusses the case of a woman who continued to be billed by the phone and Internet company months after she died. The woman's daughter-in-law had wanted to set up high-speed Internet service at her mother-in-law's house because she was fighting breast cancer and was confined to her home, and she was hoping her mother-in-law could have a connection with the outside world through the Internet.

The daughter-in-law says that there were problems with setting up the service and months later it still was not working. When the mother-in-law passed away, the service still had not been set up. The service was ordered with the daughter-in-law's credit card and she canceled the services a few days after her mother-in-law died. A few months later, however, she was still receiving bills for the services for over $100. When she told the company that her mother-in-law had died, they still apparently did not get the message because, soon after, they turned the bill over to a collection agency and the daughter-in-law started getting calls from creditors.

Lenders agree to compensate military victims of wrongful foreclosure

  • 28
  • May
    2011

Military service members are specially protected by federal law when being foreclosed upon by mortgage lenders, but lenders do not always comply with these specific regulations. Last week, the Justice Department settled a case with a subsidiary of Bank of America and Saxon Mortgage Services for violating the Servicemembers Civil Relief Act while processing foreclosures between 2006 and 2010.

According to a recent article on the case in The New York Times, the two lenders agreed to compensate victims of illegal foreclosure practices, to improve any damage to credit scores from the wrongful foreclosures, and to upgrade training practices to ensure that employees know how to comply with the Servicemembers Civil Relief Act.

In Florida and elsewhere, Bennigan's reemerges from bankruptcy

  • 23
  • May
    2011

Drunken pot roast, bacon cheeseburger chips, fried cheesecake and more. Those meals and treats are undoubtedly familiar to fans of the once-foundering Bennigan's chain of quasi-Irish restaurants. And it's all being resurrected in a return to Florida.

Several companies that owned the chain and 150 restaurants filed for Chapter 7 bankruptcy protection in 2008, but the chain is under new management and is staging a comeback here and elsewhere.

Florida foreclosure backlog may continue to grow

  • 20
  • May
    2011

A foreclosure can be a difficult experience for Tampa area residents. Typically, a Florida family that must undergo the foreclosure process is already under financial stress from debt or unemployment issues. A complicated or drawn out foreclosure can put additional pressure on these Florida families and strain relationships.

There are many ways that Tampa area residents can defend against foreclosures and remain in their homes. Many mortgage companies break the terms of their own mortgage contracts and these mistakes can be used by homeowners as defenses against a foreclosure. Many Florida residents may have to wait to bring their foreclosure defenses however because state lawmakers recently decided not to extend a court stipend targeted at reducing Florida's enormous foreclosure backlog.

Forced bankruptcy case against former billionaire dismissed

  • 18
  • May
    2011

A former billionaire fought a government petition to force him into bankruptcy and the petition against him was dismissed by a federal judge this week. Tim Blixseth was the billionaire founder of the Yellowstone Club of Montana, an exclusive resort. He said he now intends to go after the Montana Department of Revenue for filing a bad faith petition, according to The Associated Press, in order to try to get sanctions filed against them. If they are sanctioned, it could mean that Blixseth will actually be the one who is paid money, possibly hundreds of thousands of dollars.

Blixseth said that the government treated him badly. He said that he was glad that he at least had the resources to mount a strong defense against the forced liquidation of his assets, and hoped the same thing wouldn't happen to other Americans who might not be able to fight it as aggressively as he could.

Some debt collectors using social media to harass people: Part 2

  • 11
  • May
    2011

As discussed in the previous post, some debt collectors have been using Facebook and other social media sites to deliberately harass consumers. While debt collectors can use social media to locate consumers, they cannot use it to harass them. They also cannot harass their friends and families or pose as friends or acquaintances in order to gain access to their site and harass them.

Creditors or third-party agencies looking to collect a debt cannot threaten harm or legal action. They cannot say you will be arrested or lie or bluff about other legal actions they are going to take unless they truly are going to take them as permitted by law.

If a creditor cannot find a person through other means, they may contact a family member to get contact information, but at least two people in Florida have said that debt collection agencies had their contact information and still contacted friends and family about a debt on Facebook in order to harass and embarrass them.

Some debt collectors using social media to harass people: Part 1

  • 09
  • May
    2011

Whether debt collectors can legally use Facebook or other social media sites to try to collect debts has to do with whether they are crossing the line from communication into harassment. Debt collectors can use social media to locate people, but debt collectors are in violation of the Fair Debt Collection Practices Act if they use social media to harass a person or to publicly disclose that a person owes a debt. They can also not use social media to try to "friend" a person or communicate with them by posing as a friend or acquaintance.

An attorney quoted in a recent MSN Today article on the topic said that some debt collectors are deliberately using social media as a tool to harass people. A debt collector can find one person and easily find their friends and family on their profile page and contact them, telling them about the debt and asking them to have the person they are targeting call the debt collection agency. This is an illegal practice, but some people may just pay the debt to get the harassment or public embarrassment to stop.

Foreclosures could rise for businesses this year

  • 06
  • May
    2011

Financial and economic experts are predicting that foreclosures of commercial properties could rise this year in Florida and around the country. Commercial properties have fared somewhat decently during the real estate market crash, but that could begin to change as loans become due this year or soon after. Commercial real estate loans have terms of five to seven years, and many loans for commercial properties will be coming due soon, which could result in a rise in foreclosures.

According to a recent piece in the Herald-Tribune, a Congressional Oversight Panel made up of economic experts and former regulators reviewed the situation at the beginning of last year. The panel noted that $1.4 trillion in loans for commercial properties would be coming due in the upcoming four years. Because of the market crash, more than half of these loans are twice the value of the commercial property's current value.

Foreclosure rescue firms sued by state of Florida

  • 05
  • May
    2011

According to the state Attorney General's office, Florida homeowners trying to keep mortgage lenders from foreclosing on their properties are being gouged by so-called foreclosure rescue firms. Three companies that reportedly promised to help Floridians modify mortgage terms or avoid home foreclosures were charged with taking money from clients and doing nothing to help them.

Homeowner Protection Economics, DC Financial Group and Deleverage America have been accused of illegally charging up-front fees of $495 to $2000 for lender-negotiated loan modifications and home-foreclosure mitigations.

According to Consumer Affairs, the complaint alleges the companies never even tried to contact mortgage lenders or to provide the services they claimed. The accused companies had used media blitzes to advertise that they were able to work with lenders to lessen the debt-load of homeowners and to fend off property foreclosures -- promises they allegedly never kept.