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Judge Jack B. Schmetterer

In re John E. Anderson
October 17, 2011
In re Margret Borczyk
October 5, 2011
In re Sarah DiGregorio
September 28, 2011

Judge Jacqueline P. Cox

In this Amended Memorandum Opinion, the Court granted the Defendants’ Motion to Dismiss the Chapter 7 Trustee’s Adversary Proceeding in part. The Trustee alleges in the First Amended Complaint that insiders of the Debtor engaged in a series of complex transactions by which the Debtor was stripped of its real estate, funds and business opportunities. The Court dismissed counts alleging fraudulent transfer claims under Illinois law because the transfers in issue occurred more than four years before the bankruptcy case was filed. Illinois law provides generally for a four-year limitations period for the prosecution of fraudulent transfer claims. 11 U.S.C § 544(b) allows a trustee to avoid any transfer of an interest of a debtor in property that is avoidable under applicable law by a creditor holding an allowable unsecured claim. The trustee can use that creditor's more favorable limitations period. 26 U.S.C. § 6502 allows the IRS 10 years to collect taxes under certain circumstances. Relying on a 7th Circuit ruling in In re Leonard, 125 F.3d 543, 544 (7th Cir. 1997) where that court held that "the trustee can assume the position of any one of them" in referring to 13 filed claims, the Court held that the Trustee cannot rely on 11 U.S.C. § 544(b) to take advantage of the IRS' 10-year limitations period because the IRS had not filed a proof of claim. The Court noted that Federal Rule of Bankruptcy Procedure 3004 allows a trustee or a debtor to file a proof of claim on behalf of a creditor

Judge A. Benjamin Goldgar

In re Lorenzo J. Brent
September 29, 2011

06 B 06197

Judge Pamela S. Hollis

Lakewood entered into an agreement to outsource its box fan manufacturing to Chicago American Manufacturing (CAM). The agreement included remedies for CAM if Lakewood failed to purchase the forecasted amounts of box fans within a certain time period. After an involuntary petition was filed against Lakewood, the Trustee rejected the agreement and brought suit against CAM to enjoin further manufacturing as well as selling any of the unpurchased box fans. The court first determined that the agreement was ambiguous, then interpreted the ambiguous provisions using parol evidence, and concluded (among other findings) that CAM's remedies included a license to manufacture and sell box fans using Lakewood's patents and trademarks. Rejection of the agreement did not terminate that license, and all box fans that CAM manufactured and sold were covered by the license granted in the agreement. Judgment for the defendant on all counts.