Majestic May Prompt 3rd Circ. 'Property Of Estate' Review

Law360, New York (June 4, 2013, 3:35 PM EDT) -- On May 21, 2013, the United States Court of Appeals for the Third Circuit overturned a bankruptcy court order that allowed the debtor, The Majestic Star Casino LLC, to avoid taxes imposed upon it by operation of law when the casino operator’s nondebtor parent revoked its own “S” corporation status (which, in turn, extinguished the subsidiary debtor’s “QSub” corporation status).

The Court of Appeals, in what it characterized as a question of first impression in the federal courts of appeal, determined the bankruptcy court erred in...
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