Zazzali v. Swenson (In re DBSI Inc.)

Ruling: 
Sovereign immunity does not apply to prevent state law fraudulent transfer proceedings against IRS.
Procedural posture: 
A chapter 11 trustee filed a complaint against defendants, the IRS and insiders, to recover allegedly fraudulent transfers made to the insiders and on behalf of the insiders to the IRS and state taxing authorities. Pursuant to Fed. R. Civ. P. 12(b)(6), the United States filed an amended motion to dismiss those counts seeking to recover transfers made to the IRS under 11 U.S.C.S. § 544(b)(1), applying Idaho fraudulent transfer statutes.
Issue: 
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Commercial case opionion summary, case decided on February 11,2011, LexisNexis #0411-016