3rd Circ. OKs Nixing Claims For Original Holder's Actions

Law360, Wilmington (November 18, 2013, 3:16 PM ET) -- The Third Circuit on Friday affirmed a bankruptcy court ruling that nixed trade claims purchased from KB Toys Inc. creditors who received preferential payments, finding such claims should be disallowed regardless of who holds them.

ASM Capital LP and ASM Capital II LLP purchased nine claims from trade vendors following the toy store's first foray into Chapter 11, but saw them go up in smoke after KB's trustee brought successful preference actions against the original companies and then got a bankruptcy court to disallow the claims....
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