Gugino v. Greater Rome Bank (In Re Payroll America, Inc.)

MEMORANDUM

The Chapter 7 Trustee for Debtor Payroll America, Inc. (“PAI”) filed an adversary proceeding against Greater Rome Bank (“GRB”) seeking ■ to recover funds from allegedly fraudulent transfers. The bankruptcy court granted summary judgment in favor of GRB. Trustee appealed to the district court, which affirmed, and then appealed to this court. We review the bankruptcy court’s grant of summary judgment de novo, Caneva v. Sun Cmtys. Operating Ltd. P’ship (In re Caneva), 550 F.3d 755, 760 (9th Cir.2008) (per curiam), and we affirm.

Under 11 U.S.C. § 550 (a), Trustee may recover property fraudulently transferred from (1) “the initial transferee,” (2) “the entity for whose benefit such transfer was made,” and (3) subsequent transferees. GRB does not fit into any of the categories of § 550(a).

GRB was not an initial transferee of the cure wires. This circuit applies the dominion test to determine whether an entity is an initial transferee. Universal Serv. Admin. Co. v. Post-Confirmation Comm. of Unsecured Creditors of Incomnet Comms. Corp. (In re Incomnet, Inc.), 463 F.3d 1064, 1070 (9th Cir.2006). Under the dominion test, “a transferee is one who ... has dominion over the…