1st Circ. Nixes HSBC Bid For $100M Ch. 7 Interest

Law360, New York (June 24, 2011, 5:47 PM EDT) -- The First Circuit on Thursday barred HSBC USA NA from collecting post-petition interest on its senior noteholder claims against the long-defunct Bank of New England Corp., instead treating junior noteholders to roughly $100 million from the Chapter 7 estate.

Hearing the dispute for the second time, the appeals court found that the investors did not intend to subordinate the junior notes to post-petition interest on the senior notes, affirming the Massachusetts bankruptcy court’s analysis of the debt securities scene of the 1970s and 1980s, and granting...
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