This matter was on appeal from a bankruptcy court ruling that a previously approved contingent fee agreement between debtor and special counsel was void under both California law and the Bankruptcy Code. The district court affirmed, first, because the bankruptcy court correctly ruled, pursuant to 11 U.S.C. § 328(a), that the agreement was improvident in light of developments not capable of being anticipated at the time the agreement was originally approved. Second, the district court agreed with the bankruptcy court's rulings that the contingent fee agreement was voidable under California's Business and Professional Code, and that debtor was not estopped from repudiating the fee contract. Third, the district court held that the bankruptcy court had not abused its discretion in awarding a "reasonable fee" of $329,713 on counsel's request for $938,617. Finally, the district court determined that the bankruptcy court also did not abuse its discretion by refusing to award prejudgment interest on the fees awarded, since such an award is required to be "otherwise equitable," which it would not have been, given the record of counsel's improper motives in dealings with the debtor.

In 1993, chapter 11 debtor sold substantially all of its assets to Oregon Steel, a good faith purchaser for value, in accordance with 11 U.S.C. § 363(b) and pursuant to a court approved plan of reorganization. Objecting creditors appealed, but did not seek a stay of the bankruptcy court's orders confirming debtor's reorganization plan and authorizing the sale to Oregon Steel. Noting the importance of finality in bankruptcy, the district court held that appellants' failure to seek a stay of the bankruptcy court orders rendered the appeal moot under § 363(m). The district court also rejected appellants' request to affirm the asset sale but remove the provision that the sale was free and clear of creditor claims. In so ruling, the court indicated it could not grant appellants such relief without undoing a substantially and effectively consummated plan, particularly since the free and clear term was an express condition of the sale. Removal of that condition would risk unravelling the entire sale agreement, and the court "refuse[d] to play the 'Humpty Dumpty repairman' for such an ominous task."

Plaintiff filed a motion for default judgment in a nondischargeability action filed pursuant to 11 U.S.C. § 523(a)(2). The basis for the debt was a check issued by debtor to a third party that was cashed at plaintiff's business and then returned for insufficient funds. The court held that, on a motion for default judgment, plaintiff was minimally required to both establish the existence of personal and subject matter jurisdiction and make a prima facie showing of the elements of its claim. Those elements include that the debtor: (1) received value from; (2) made a false representation to; and (3) intended to defraud, the plaintiff. The court found that plaintiff failed to prove the elements of its claim that the debt should be excepted from discharge under § 523(a)(2) by a preponderance of the evidence. In so finding, the court held that issuance of a check on an account containing insufficient funds is not an implied representation that sufficient funds are on account to cover the check, relying on Williams v. United States, 458 U.S. 279 (1982). Additionally, the check itself did not amount to a written statement regarding the debtor's financial condition for purposes of § 523(a)(2)(B). The court refused to give collateral estoppel effect to a Nevada state court default judgment, as the issue of intent had not actually been litigated in that case, nor were the elements of the state statute identical to the elements required to prevent discharge under § 523(a)(2)(A) or (B). Likewise, a Nevada criminal statute that implied intent could not provide the basis for a finding of intent under § 523(a)(2). The court held the debt to be dischargeable and dismissed the adversary proceeding.

CF&I sold two mines to Wyoming Fuel in 1983. Under a collective bargaining agreement ("CBA") between CF&I and the United Mine Workers of America, CF&I was obligated to require any successor to its operations to assume its obligation to pay non-pension benefits to retirees. Rather than requiring Wyoming Fuel to assume that obligation in the sale, CF&I agreed to continue providing those benefits itself. After the sale, CF&I paid non-pension retiree benefits to its former employees until October 1992, which was nearly two years after the filing its chapter 11 petition. The court found that, since Wyoming Fuel was a "successor," the CBA was terminated by the sale, and CF&I had no contractual liability to provide non-pension benefits after the sale, although CF&I had breached the CBA by failing to require Wyoming Fuel to assume its benefits obligation. The court also considered whether CF&I was obligated to pay retiree benefits pursuant to 11 U.S.C. § 1114. However, since CF&I did not enter bankruptcy with either a contractual or common law duty to pay retiree benefits, the court ruled that CF&I's confirmed plan of reorganization did not impermissibly alter or modify rights prohibited by § 1114 by failing to provide for payment of retiree benefits. Since neither CF&I nor Wyoming Fuel was obligated for post-sale benefit payments, the court determined that the 1974 Benefit Plan (a non-pension benefit trust fund) was liable for those benefits. CF&I asserted claims against the 1974 Benefit Plan, under 11 U.S.C. §548 and 549, seeking to avoid the post-sale benefit payments it had made. The court determined that, with respect to prepetition benefit payments, all of the elements (reserving the issue of insolvency) of § 548(a)(2)(A) avoidance had been established. Post-petition benefit payments were voidable under § 549, as they were neither allowed under Title 11 nor authorized by the court. Finally, since the 1974 Benefit Plan was legally responsible for post-sale benefit payments, the court held that § 550(a)(1) allowed recovery from it of post-sale payments that were made by CF&I, because the facts established that the 1974 Benefit Plan was an entity for whose benefit the payments were made. Moreover, § 550(a)(1) does not require that the payor intend the benefit in order to avoid the payment. Lowrey v. First Nat'l Bank (In re Robinson Bros. Drilling, Inc.), 97 B.R. 77 (W.D. Okla. 1988), aff'd sub nom. Hanover Leasing Corp. v. Lowrey (In re Robinson Bros. Drilling, Inc.), 892 F.2d 850 (10th Cir. 1989).