Compromise Which Includes Waiver of Preference Claims Approved

The following is a summary of a Minnesota bankruptcy case or a case relevant to Minnesota bankruptcy law.

Minnesota Bankruptcy Case:

Cornerstone Bank v. Seaver (In re Hecker), 2010 WL 3463417 (D. Minn. 8/30/10) (Tunheim, J.).

Case Summary:

Compromise Which Includes Waiver of Preference Claims Approved

The trustee was party to an agreement that involved one of the debtor’s corporate entities selling a car dealership. As part of the arrangement and compromise, the trustee agreed to waive any preference claims that he may have had against other parties to the sale. Judge Kressel approved the compromise, which included the sale. Cornerstone Bank, et al., which claimed a security interest in the debtor’s property, including intangibles, objected to the arrangement and appealed the approval of the compromise. On appeal, Judge Tunheim affirmed the bankruptcy court.

Credit: The preceding was a summary of a case relevant to Minnesota bankruptcy law. The case summary was prepared by the U.S. Bankruptcy Court through Judge Robert J. Kressel & attorney Faye Knowles.