Friday, September 10, 2010

Have You Read? Recent Headlines at California Law Report

In case you haven't checked out my new blog, the California Law Report, I thought I'd include a number of links to articles I've posted over there. Here are some recent headlines:

Thursday, July 29, 2010

New Blogs

Most of my blogging these days is done at two separate blogs which can be found here:

Wednesday, July 7, 2010

Schwarzenegger Signs Bill Expanding Access to HOV Lanes

California Governor Arnold Schwarzenegger has signed a bill, AB 1500 (Lieu), which will allow new low-emission vehicles -- primarily electric vehicles -- access to HOV lanes throughout California no matter how many occupants are riding in the vehicle.

This is good news for Nissan, which plans to release the all-electric Nissan Leaf later this year. The fact that commuters driving a Leaf will be able to drive in California's 1,300 miles of HOV lanes will certainly be a selling point.

A separate California bill, SB 535, would allow plug-in hybrids such as a possible 2012 Toyota Prius Plug-In Hybrid and electric cars with range-extending gasoline engines (such as the 2011 Chevrolet Volt) to access the HOV lanes regardless of passengers. That bill has not yet passed.

Read more here.

John Corcoran is an Associate with Plastiras & Terrizzi law firm in San Rafael, California (Marin County). He advises clients on various small business matters including clean tech and renewable energy, real estate, and general civil litigation. He may be reached at or (415) 472-8100 x211.

Wednesday, October 7, 2009

It's not often a fast food restaurant closes, much less files for bankruptcy protection. But that's exactly what happened recently when the owner of 70 Jack In the Box fast food restaurants throughout northern and Central California suddenly shut down all his stores.

Abe Alizadeh of Kobra Associates Inc., who owns and operates the restaurants, closed all 70 of his restaurants in mid-September when his negotiations with his debtors broke down and he had to file bankruptcy.

Sadly, this story has been more of a common occurrence during the past year, with numerous businesses and individuals going through bankruptcy. It wasn't so long ago, however, that it seemed Congress had high hopes of dramatically decreasing the number of bankruptcy filings.

When Congress did a major revamp of the bankruptcy law in 2005, the goal was to decrease the number of bankruptcies each year by making it more difficult for people to file bankruptcy. A secondary goal was to force more people to repay their debts over time through a Chapter 13 plan rather than liquidating their debts through Chapter 7.

Four years later, it's clear that the new bankruptcy law has had very little success in achieving its goals. After an initial reduction in the number of filings, the number of people and businesses filing for bankruptcy protection has shot up and continues climbing. In 2008, there were approximately 1.1 million bankruptcy filings and in 2009, the number is likely to end up around 1.4 million bankruptcy filings -- a rate of 5,075 bankruptcy filings per business day.

At the same time, bankruptcy has become more complex and more expensive than it once was. Before the 2005 law, a bankruptcy filing averaged $1,000. Today the cost is twice that. People who are filing bankruptcy for the most part are doing so because they lost a job or suffered a major health problem. They have to file bankruptcy because they have no other option. Now they just have to hire a lawyer and pay a lot more than they did before the 2005 law came into effect.

Bankruptcy is not the only option for people in financial trouble however. There are numerous alternative options.

If you're contemplating bankruptcy, consider these options first:

1. Consider Bankruptcy alternatives. You may be better off with a debt renegotiation. An attorney with experience negotiating with debtors may be able to help you avoid bankruptcy by negotiating with your creditors, especially if you don't have a large number of creditors.

2. Negotiate with your Credit Card companies. Credit Card debt is unsecured debt, meaning credit card companies are last to get repaid if you declare bankruptcy. I have had success in the past with calling credit card companies for clients and settling their credit card debt for far less than is owed.

3. Consider whether you will even qualify for bankruptcy. If you make a decent salary but have high debt, you may only qualify for Chapter 13. However, if your debt is too high (over $336,690 in liquidated unsecured debt and secured debt of less than $1,010,650), you won't qualify for a Chapter 13. Consult an attorney to figure out if you will qualify.

4. Surrender your property. If you have a secured loan, you may try surrendering your property. For example, if you bought a $3,000 TV from Best Buy and financed the purchase, you can try calling Best Buy and seeing if they will take back the TV.

5. Do a short sale. If your house is under water and your mortgage payments are dragging you down, you may want to consider selling your house for less than it's worth. You will ultimately need to get the approval of your lenders before the sale goes through.

Before you embark on any of the above approaches, you should be sure to consult a competent attorney and accountant to make sure there aren’t any legal or tax consequences in your particular situation.

If you have questions about bankruptcy or debt renegotiation, feel free to contact John Corcoran for a free consultation at (415) 472-8100 x211 or

Friday, September 25, 2009

Marin I.J. and Contra Costa Times Mention My New Position

I got a brief but nice mention in the Marin Independent Journal and the Contra Costa Times this week. As the Marin IJ reported in its "Movers & Shakers" column:

Marin attorneys Thane Schultz and John Corcoran have joined the San Rafael law firm of Plastiras & Terrizi.

Schultz, a longtime Marin resident, will focus on family law and general civil litigation. His previous work experience included stints with a civil litigation firm and two years running a family real estate development business in Australia.

Corcoran, a Tiburon planning commissioner, previously worked for a Silicon Valley law firm focusing on estate planning, employment law and small business representation.
I'm not sure whether I'm a "mover" or a "shaker," but if I find out, I'll post it here.

Saturday, September 19, 2009

New Bill Prevents Attorneys From Taking Upfront Fees for Loan Modifications

The State Senate recently passed a bill which will significantly crack down on “fly by night” “loan consultant” operations which promise to modify people’s mortgages for a fee, but could also have the unintended consequence of making it harder for legitimate hardship cases to find a lawyer to represent them.

The bill, which Gov. Schwarzenegger is expected to sign, passed with wide margins in the State Senate, benefiting from the political backlash against loan modification outfits. SB 94 forbids anyone, including attorneys, from taking a retainer for the purpose of negotiating or attempting to negotiate residential loan modifications or for “other forms of mortgage loan forbearance” (presumably this language prevents attorneys from helping borrowers obtain a short sale as well). It also bars persons, including attorneys, from obtaining a power of attorney from a borrower for the purpose of negotiating a loan modification, a document which is often crucial in order to get banks to communicate with the attorney about the borrower. It also prevents these service providers from charging for their services until all services are complete and bars them from taking any lien of any type to guarantee payment.

Any person who does provide loan modification services must provide a large statement regarding loan modification fees prior to obtaining a signed fee agreement which warns the consumer that it is “not necessary to pay a third party to arrange for a loan modification or other form of forbearance from your mortgage lender or servicer. You may call your lender directly to ask for a change in your loan terms.”

While the Legislature is well intentioned in cracking down on disreputable companies which have taken advantage of homeowners in trouble, the problem with this bill is that it doesn’t recognize legitimate cases of individuals who have lost a job, received a cutback in hours at work, or gotten sick, and who legitimately need help negotiating a workout with their mortgage lenders. Attorneys commonly take a retainer in advance of providing services which must be deposited in the attorney’s client trust account. These retainers ensure the attorney will be paid and, in cases involving debts or a bankruptcy filing, this is often the only way people can obtain legal assistance, as attorneys would otherwise not risk not getting paid for their time and services. Many borrowers don’t have the time or patience to spend months and to follow up dozens of times with banks which have ever-changing requirements for mortgage relief, frequently lose paperwork provided to them, and/or flat-out refuse to help their borrowers out. Nonprofit housing counseling agencies are currently overwhelmed with people who have these kinds of problems and they can’t keep up with the demand. By passing legislation which is over-inclusive, it’s certain that some legitimate cases are going to find it more difficult to get an attorney to represent their interests.

UPDATE 9/19/09: Evidently, federal regulators at the Federal Trade Commission are also considering passing a ban on up-front fees for mortgage modifications. Hopefully the federal action will crack down on fraudulent mortgage modification offers without hurting legitimate situations in which homeowners in trouble desire to hire an attorney to assist them.

Tuesday, July 28, 2009

Twitter Defamation Lawsuit Highlights Emerging Legal Issues

You could see this coming. A Chicago landlord has sued one of its tenants for defamation for publishing a ‘tweet’ on Twitter which portrays the landlord in a less than flattering light.

Horizon Group Management filed a complaint in the Circuit Court of Cook County, Illinois, on July 20, 2009, against Amanda Bonnen, a tenant of Horizon residing at 4242 N. Sheridan Road, Chicago, Illinois.

The lawsuit, which can be found here, asks for $50,000 in damages for defamation.

Twitter is a micro-blogging site which allows users to communicate with their “followers” with short, 140-character posts. The site has received attention in recent months for its usage by celebrities, political leaders and even protestors and revolutionaries in countries such as Iran and Moldova.

This isn’t the first time a lawsuit involving Twitter has received attention. In July, St. Louis Cardinals Manager Tony La Russa dropped his lawsuit against Twitter, which sought unspecified damages because someone was pretending to be him and using Twitter to post "updates."

In addition, earlier this month Twitter co-founder Biz Stone (@biz) disclosed publicly that the service was considering legal options after a hacker hacked into his personal email account and Techcrunch published documents which had been leaked. (Full disclosure: I attended junior high with Biz Stone, though he was a few years ahead of me.)

We can expect additional novel legal issues to continue to come up as Twitter builds in popularity. For example, defendants in lawsuits who chronicle their day-to-day with dozens of short updates about what they’re doing may find their postings used as evidence against them. As far as I know, we haven’t yet seen a criminal prosecution where Twitter has been used to establish an alibi as of yet, but I’m sure we will soon.