Buffet Chain Dodging $3M Tax Bill In Ch. 11: Calif.

Law360, Wilmington (February 6, 2012, 7:14 PM EST) -- A California tax authority accused bankrupt Buffets Restaurants Holdings Inc. on Thursday of attempting to skip out on a $3 million tax bill left over from the buffet chain’s previous stint in Chapter 11.

In a motion filed in Delaware bankruptcy court, the state’s franchise tax board asked U.S. Bankruptcy Judge Mary F. Walrath to protect its claim by vacating a prior order allowing Buffets to pay $34 million in other tax obligations with proceeds from its debtor-in-possession loan.

The order effectively places California’s tax claim...
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