11.25.08
Posted in Uncategorized at 12:10 pm by Eric
In light of the short week, we’re not blogging. We’ll be back Monday.
In the meantime, it’s worth noting one attorney that forgot the fundamental rule among lawyers: Work hard to throw your client a life preserver, but don’t let the client take you down with them.
Today was one of reckoning for prominent Los Angeles attorney Terry Christensen. He was sentenced to three years in federal prison and fined $250,000 for conspiring with Hollywood private investigator Anthony Pellicano (pictured) to wiretap billionaire Kirk Kerkorian’s former wife, for which Christensen was convicted in August.
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11.21.08
Posted in Uncategorized at 12:10 pm by Eric
If you’re funneling money into your corporation, take back a lien on the assets. It could help immensely down the road. And if you later obtain bank financing and the bank asks you to discharge your lien, offer to provide a subordination agreement instead.
Some simple advice for these troubled economic times.
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11.20.08
Posted in Tax at 6:43 pm by Eric
The (former) Commies give their businesses tax breaks.
The tax changes in Putin’s plan would cut the Russian corporate tax to 20 percent from 24 percent on January 1st and “reduce taxes for small businesses and speed refunds of value-added tax.”
Meanwhile, China—which cut its corporate tax rate to 25 percent this year from 33 percent—recently announced reforms to their VAT in order to reduce the cost of the tax on businesses.
But as I understand it from Beltway rhetoric, we’re getting ready to raise corporate tax rates.
Are things topsy-turvy?
Link. Via.
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11.19.08
Posted in Uncategorized at 1:59 pm by Eric
We get that question occasionally. The answer: Yup. In fact, a court will enforce it to the minutest detail . . . and will decline to enforce something that might be implied but not explicitly spelled out. One husband found out the hard way after he paid $2.1 million for the marital home and the wife paid only $80,000: She got half. The reason: The pre-nup didn’t provide that the home would be divided equitably or in any manner other than “50-50.”
You can read the November 2008 Michigan Court of Appeals decision here.
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11.18.08
Posted in Uncategorized at 1:23 pm by Eric
I assume everyone has heard that Mark Cuban has been charged with insider trading (a crime which resulted in a six-month sentence for Martha Stewart). This corporate law professor thinks the charges have a decent chance. Click the link to see his analysis.
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11.17.08
Posted in Uncategorized at 9:03 pm by Eric
Getting foreclosed? Don’t be so sure that your out-of-town or fly-by-night lender has their ducks in the row. You might have a great defense if you’ve mortgaged with the shadier side of lending in order to save that extra 1/4 of 1%. From the Wall Street Journal Law Blog:
Now comes the foreclosure case of Joanne Fredenburg, a widowed homeowner in Lehigh Acres, Fla., where real estate prices have plummeted. Last month Ms. Fredenburg was served with not one but two foreclosure lawsuits from two different plaintiffs that both claimed to own her promissory note and mortgage and said she owed them each more than $276,000. That, of course, is impossible. (Click here and here for the two complaints.)
One lawsuit seems to make sense. The plaintiff is a unit of Deutsche Bank that acts as a guardian or “trustee” for investors of mortgage-backed securities. Those investors collectively own loans such as Fredenburg’s. But the other lawsuit was filed by a mortgage-servicing company that collects borrower payments on behalf of investors. Surely that is a mistake, as servicers don’t typically own loans.
Indeed, following an inquiry by the Law Blog, we’re told that the servicer, American Home Mortgage Servicing, will withdraw its lawsuit, which was filed by Miami-based Adorno and Yoss LLP.
But Ms. Fredenburg’s lawyer is none too happy. Even after American Home withdraws its suit, J. Rex Powell of Cape Coral says he will ask for discovery to find out what payments his client made, whether they were paid to the right entity and whether she was given the proper credit. Given that most people don’t defend against foreclosure lawsuits and the plaintiffs are awarded default judgments, Powell says the case raises an interesting question: Are entities wrongly filing foreclosure suits and collecting on notes they don’t own?
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11.14.08
Posted in Uncategorized at 12:35 pm by Eric
When I first started setting up 529 college savings plans for my kids, I was advised to establish all funds in my oldest child’s name, so I could then “roll down” unused amounts to other children. I’m not sure if that advice was bogus or whether the law changed. The current IRS code provisions don’t appear to contain any provision that says the money must be rolled down to a younger sibling. The transferee just needs to be a “member of the family” of the designated beneficiary.
The phrase “member of the family,” incidentally, includes a laundry list of relatives:
Son, daughter or descendant of either;
Stepson or stepdaughter;
Brother, sister, stepbrother or stepsister;
Father, mother, or ancestor of either father or mother;
Stepfather or stepmother;
Cousin;
Son or daughter of a brother or sister;
Brother or sister of the father or mother;
Son-in-law; daughter-in-law; father-in-law; mother-in-law; brother-in-law; or sister-in-law;
Spouse of a designated beneficiary who is described above.
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11.13.08
Posted in Uncategorized at 12:49 pm by Eric
“GM merging with Chrysler doesn’t solve anything. It’s like two alcoholics deciding that they could maybe quit drinking if they got married.”
Megan McCardle
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11.12.08
Posted in Tax at 1:33 pm by Eric
The World Series of Poker has become big business. So big, in fact, that the nine finalists all paid six-figure taxes on their winnings . .. and the poor slob who won paid $6.6 million (thanks to a near-confiscatory Dutch tax rate of 72.8%). Summary:
1. Peter Eastgate (Denmark) won $9,152,416 — $6,660,545 Dutch tax (72.8% rate)
2. Ivan Demidov (Russia) won $5,809,595 — $755,247 Russian tax (13.0% rate)
3. Dennis Phillips (IL) won $4,517,773 — $1,568,950 federal tax, $135,533 state tax (37.7% rate)
4. Ylon Schwartz (NY) won $3,774,974 — $1,396,304 federal tax, $387,966 state tax (47.3% rate)
5. Scott Montgomery (Canada) won $3,096,768 — $929,030 withholding tax (30.0% rate)
6. Darus Suharto (Toronto) won $2,418,562 — $725,569 withholding tax (30.0% rate)
7. David Rheem (CA) won $1,772,650 — $651,262 federal tax, $170,302 state tax (46.3% rate)
8. Kelly Kim (CA) won $1,288,217 — $470,995 federal tax, $121,074 state tax (46.0% rate)
9. Craig Marquis (TX) won $900,670 — $328,911 federal tax (36.5% rate)
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