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Denial of Petition for Recognition of Israeli Bankruptcy Proceeding Upheld

By FindLaw Staff on May 28, 2010 | Last updated on March 21, 2019
Contract, Education and Employment Matters Also Decided

Gagnon v. United Technisource Inc., No. 09-20098, was an action under the Fair Labor Standards Act (FLSA) based on defendants' failure to increase plaintiff's "per diem" hourly rate.  The court of appeals affirmed judgment for plaintiff in part, holding that 1) when, as here, the amount of per diem varies with the amount of hours worked, the per diem payments are part of the regular rate in their entirety; 2) there was no clear error in the district court's finding that the violation was willful; and 3) in paying the per diem, defendant did not pay plaintiff any additional sums that could be characterized as advanced or inappropriate amounts subject to an offset against the overtime owed to him.  However, the court vacated in part, holding that the district court needed to provide additional explanation for its awards and with specific instructions to include time spent on this appeal in determining the amount of attorney's fees.

Shandong Yinguang Chem. Indus. Joint Stock Co. v. Potter, No. 09-20268, an action against the individual owner of a corporation seeking to pierce the corporate veil based on common law fraud and fraudulent inducement.  The court of appeals affirmed the dismissal of the complaint, holding that 1) plaintiff did not plead that defendant presented any detailed, corroborating information, facts or figures to support the company's financial statement that might entice a reasonable person to attach importance to the statement; and 2) piercing the corporate veil was not a separate cause of action, but a method to impose personal liability on shareholders and corporate officers who would otherwise be shielded from liability for corporate debts.

In re: Ran, No. 09-20288, involved an Israeli bankruptcy receiver's appeal of the district court's denial of his petition for recognition under Chapter 15 of the Bankruptcy Code of an ongoing, involuntary bankruptcy proceeding pending in Israel.  The court of appeals affirmed, holding that 1) it was evident that, when the receiver filed the petition for recognition, the debtor's habitual residence was in Houston, Texas; 2) while sufficient to rebut the presumption that debtor's center of main interest was in the U.S., the receiver's evidence was nevertheless insufficient to prove by a preponderance of the evidence that Israel was the location of debtor's center of main interests; and 3) at the time the receiver filed his petition for recognition, debtor possessed neither a secondary residence nor place of employment in Israel.

R.H. v. Plano Indep. Unified Sch. Dist., No. 09-40369, involved plaintiff's appeal from the district court's denial of tuition reimbursement for private preschooling under the Individuals with Disabilities Education Act (IDEA).  The court of appeals affirmed, on the grounds that 1) the school district discussed the potential harmful effects of plaintiff's placement in a special educational environment; 2) defendant considered whether plaintiff's Individualized Education Plan (IEP) could be satisfactorily implemented in a regular classroom; and 3) the lack of extended school year services was part and parcel of plaintiff's IEP, and he was thus required to give notice to defendant of his intent to reject the terms of his existing IEP.

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