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B.C. Rogers Processors Inc. v. CIT GroupEquip. Fin. Inc. (In re B.C. Rogers Poultry Inc.)

B.C. Rogers Processors Inc. v. CIT GroupEquip. Fin. Inc. (In re B.C. Rogers Poultry Inc.)

Ruling
Independence of letters of credit from debtors' owners from debtors' agreement with lessor which they secured did not preclude equitable subrogation of owners to rights of debtor after debtor defaulted.
Procedural posture

Plaintiff former owners of bankruptcy debtors brought an adversary proceeding against defendant lessor of the debtors' equipment under a sale/leaseback agreement between the debtors and the lessor alleging that, upon the debtors' default, the lessor improperly drew on the owners' letters of credit and sold the equipment. The lessor moved for summary judgment.

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Commercial opinion summary, case decided on November 16, 2009 , LexisNexis #1209-100