News

Farmers on Drenched Land Confront Tough Choice on Planting - ABI

Millions of farm acres are set to go unplanted with corn this spring as persistent wet weather leaves U.S. farmers facing an agonizing choice: whether or not to risk trying to raise a crop, the Wall Street Journal reported. Heavy, repeated rains over the past two months have left fields saturated throughout the critical planting period for corn, typically the biggest U.S. crop by acreage. Farmers in rain-soaked states now must decide whether to file insurance claims on unplanted fields (potentially making less money off their farms), switch to less-profitable crops or take their chances sowing corn that may not have time to fully mature. The inclement weather adds another challenge to a punishing period for farmers, seed and chemical suppliers, and tractor makers. Trade disputes with major U.S. food importers including Mexico and China have cut into crop prices, adding pressure to farm incomes, after several years of bumper harvests swelled global grain supplies.


Supreme Court Rejects Strict Liability for Discharge Violations - ABI

The Supreme Court yesterday rejected a strict-liability standard for the imposition of contempt for violating the discharge injunction, according to a special analysis by ABI Editor-at-Large Bill Rochelle. Instead, the justices held unanimously that the bankruptcy court “may impose civil contempt sanctions when there is no objectively reasonable basis for concluding that the creditor’s conduct might be lawful under the discharge order.” The opinion for the Court by Justice Stephen G. Breyer also rejected the Ninth Circuit’s idea that a subjective, good faith belief about the inapplicability of the discharge injunction is a defense to contempt. It is unclear from the opinion whether the Court’s standard for a discharge violation also applies to violations of the automatic stay under Section 362. Read more.
ABI will hold a live media webinar tomorrow at 11 a.m. EDT featuring Bill Rochelle speaking with Nicole Saharsky of Mayer Brown, who was the Counsel of Record for the Respondents, and Hon. Eugene Wedoff (ret.), who joined an amicus brief in support of the petitioner. Register here to join tomorrow's media webinar (no CLE).


Extreme weather is pummeling the Midwest, and farmers are in deep trouble - The Washington Post

For the past five years, the 18 states that produce the majority of the U.S. corn crop had an average of 90 percent of their fields planted by the end of May, according to data released on Tuesday by the Agriculture Department. At the same point this year, 58 percent of the corn crop is in the ground, the Washington Post reported. The outlook for soybeans is just as dismal, with 29 percent in the ground compared with 66 percent in years past. In individual states, the gap is even more severe. Just 22 percent of the corn crop had been planted as of May 26 in Indiana. Soybeans stood at 11 percent. “Week after week, farmers haven’t been able to get out in the fields to plant corn and soybeans,” said John Newton, chief economist at the American Farm Bureau Federation, noting that this was the worst planting day on record since the USDA began tracking such data in the 1980s. “The frequency of these disasters, I can’t say we’ve experienced anything like this since I’ve been working in agriculture.” From the Rocky Mountains to the Ohio River Valley, millions of Midwesterners have endured unremitting rainfall, hundreds of dangerous tornadoes and debilitating flooding brought on by swollen waterways that are spilling into already saturated grounds — much of it farmland. The Senate voted last week to approve a multibillion-dollar aid package for communities nationwide that have been hit by natural disasters, including those affected by hurricanes in Puerto Rico and the South, wildfires on the West Coast and the flooding that continues to inundate those in the Midwest. The House’s version of the bill is being held up by Republicans who want it to include funding for Trump’s proposed wall along the U.S.-Mexico border. The House is expected to vote on the measure next week.


Fed’s top Wall Street regulator says interest rates not best tool to stop financial panics - MarketW

The Federal Reserve’s chief overseer of Wall Street says central banks should still focus on low inflation and stable employment when setting interest rates instead of trying to use monetary policy to head off potential threats to the financial system.   Randal Quarles, a Fed board member and vice chairman of supervision, said Thursday that monetary policy is not ideally suited to help prevent a deterioration in the financial system, like the one that struck the U.S. and global economies in 2008.


REITs Bet Big on the Mortgage Market - ABI

Investment trusts that buy residential home loans are piling into mortgage bonds, taking on a more prominent role in the housing market as the government retreats, the Wall Street Journal reported. Mortgage real-estate investment trusts were once small players in housing finance, but they’ve increased their mortgage-bond portfolios by almost 28 percent to $308 billion over the 12 months through March. It was the largest stockpile in a half-dozen years, according to an analysis of 15 REITs by industry research group Inside Mortgage Finance. Annaly Capital Management Inc. and AGNC Investment Corp., the two biggest companies in the sector, accounted for the majority of the growth. REITs often are publicly traded entities that invest in all types of real estate and pass most of their profits along to shareholders via dividends. They typically fund investments by raising capital in the equity and debt markets, including through short-term financing, and they use leverage to amplify their bets. The REITs focused on home loans are small relative to the $11 trillion mortgage market. But they have become a key source of capital in the housing market, particularly as the Federal Reserve trims its portfolio of mortgage bonds accumulated through stimulus measures. Additionally, government efforts to overhaul the housing-finance system could benefit REITs if policy makers clear the way for more private capital to enter.


California inches closer to unprecedented ‘Student Borrower Bill Of Rights’ - Yahoo Finance

Future student loan borrowers in the Golden State may be getting their own bill of rights.  On Tuesday, the California assembly passed the “Student Borrower Bill of Rights,” or AB376, aimed at creating the first detailed set of rules protecting those holding student debt in the U.S.  The legislation passed with an initial vote of 59 to 15 and now awaits passage through Senate committees and eventually a floor vote.  Mike Pierce, Policy Director and Managing Counsel at the Student Borrower Protection Center (SBPC), which co-sponsored the bill with others, told Yahoo Finance that "the full Senate must pass the bill no later than September [13]" to make it to California Governor Gavin Newsom's desk for his final signature before the end of the year.


House Passes Bill Making Big Changes to U.S. Retirement System - ABI

The House of Representatives passed legislation that would bring substantial changes to the U.S. retirement system, making it easier for employers to offer 401(k)-type plans and include annuities, which guarantee an annual income, as options for workers, the Wall Street Journal reported. Backed by a bipartisan group of lawmakers including Rep. Richard Neal (D- Mass.), chairman of the House Ways and Means Committee, the legislation would repeal the age cap for contributing to traditional individual retirement accounts, currently 70½. It would also increase the age to start taking required withdrawals from 401(k)s and IRAs to 72 from 70½. The House bill, known as the Setting Every Community Up for Retirement Enhancement, or Secure Act, passed with a vote of 417-3. A Senate GOP aide said that the plan is for the Senate to vote on the House’s Secure Act, rather than its own version, and Sen. Rob Portman (R-Ohio), a Finance Committee member who is active on retirement policy, said that the Senate should swiftly pass the House bill.


Exchanges Face Higher Hurdles in Boosting Data Fees - ABI

The Securities and Exchange Commission dealt a fresh blow to stock exchanges’ lucrative business of selling data and high-speed connections, the Wall Street Journal reported. New guidelines from the regulator, released yesterday, will make it tougher for exchanges to boost fees for such services by requiring them to include detailed disclosures each time they seek to adjust a fee. The SEC last year rejected two data-fee increases imposed by the New York Stock Exchange and Nasdaq Inc., prompting them to challenge the regulator’s decision in a federal appeals court.


Mission Products v. Tempnology: SCOTUS Holds that Rejection: The National Law Review

On May 20, 2019, the U.S. Supreme Court held by a vote of 8-1 that a trademark licensor’s rejection in bankruptcy of a trademark license does not terminate the licensee’s right to use the licensed mark. Mission Products Holdings, Inc. v. Tempnology, LLC, No. 17-1657, 587 U.S. (2019). In so holding, the Court resolved a circuit split on the issue. The Court reversed the decision of the First Circuit, which held that Tempnology’s rejection of a trademark license under the Bankruptcy Code had the effect of terminating Mission Products’ right to use the licensed marks.


Servicemembers exhibit higher levels of financial well-being than the U.S. population overall - CFPB

Recently, the Department of Defense (DoD) released its Annual Report on the Financial Literacy and Preparedness of Members of the Armed Forces, which shows that servicemembers exhibit slightly higher levels of financial well-being compared to the general U.S. population. Last month, the CFPB’s Office of Servicemember Affairs (OSA) released a research brief on the financial well-being of veterans. The research showed that veterans, similarly to servicemembers, experience somewhat higher levels of financial well-being than non-veterans.