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Specializing in insolvency and complex commercial matters since 1974

Firm Prevails In Homestead Equitable Lien Dispute And Concludes Global Settlement In Gosman Case - April 13, 2007

The firm has been counsel to the debtor, Abraham D. Gosman, since late 2003 in one of the largest individual Chapter 7 cases ever filed in the Southern District of Florida. After extensive litigation with the Chapter 7 Trustee and others over numerous issues, including the parties' entitlement to the proceeds of the sale of Mr. Gosman's 6.2 acre Palm Beach residence located on the Atlantic Ocean, Mr. Gosman reached a settlement with the Trustee that was conditioned upon the Court's denial of an equitable lien on his homestead. J.P. Morgan Chase Bank had asserted the entitlement to a lien based upon Mr. Gosman's alleged breach of a negative pledge agreement and alleged fraudulent conduct. The firm moved to dismiss Chase's equitable lien motion on the bases (a) that the Florida Constitution, applicable in bankruptcy cases pursuant to Section 522(b) of the Bankruptcy Code, did not permit a lien on the homestead and (b) that prior orders of the Court precluded the imposition of a lien under principles of res judicata. On the eve of a hearing to approve the global settlement, the Bankruptcy Court issued an order denying the JPMorgan Chase equitable lien on both grounds urged by the firm on behalf of Mr. Gosman. The Court subsequently approved the global settlement, which also resolved eighteen pending appeals, and the settlement has been closed. The firm's representation of Mr. Gosman was led by Harley Riedel, Wanda Golson, and Amy Harris.