BofA Rails Against Meruelo's Cash-Sharing

Law360, New York (October 20, 2009, 5:08 PM EDT) -- Bank of America NA has bridled at Meruelo Maddux Properties Inc.’s bid for continued use of cash collateral, contending the bankrupt real estate company cannot use money generated from properties securing the bank’s loans to pay the claims of a related estate.

Bank of America urged Judge Kathleen Thompson of the U.S. Bankruptcy Court for the Central District of California to deny Meruelo’s emergency motion, pointing out that the debtor is barred from making intercompany loans because the numerous cases have not been consolidated.

While Meruelo’s...
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