In Re Boogie Enterprises, Inc., Dba: Action Headwear Fka: Plainview Headwear, Debtor. David A. Gill, Chapter 7 Trustee v. United States
Opinion
Opinion
Norris, J.
The trustee for Boogie Enterprises (“Boogie”) appeals the judgment of the district court, 79 B.R. 4 , which reversed the bankruptcy court’s grant of summary judgment in the trustee’s favor. At issue is whether a financing statement describing the collateral for a loan as “personal property” was sufficient, under Cal.Comm.Code § 9402(1), to “perfect” the Small Business Administration (“SBA”)’s security interest in the proceeds of a lawsuit settlement. We agree with the Bankruptcy Court that it was not, and accordingly reverse the judgment of the district court.
BACKGROUND
The SBA is a creditor of Boogie under a 1983 loan agreement which gives the SBA a security interest in Boogie’s assets. In 1984, Boogie filed a Chapter 11 bankruptcy petition. Shortly afterward, the trustee for Boogie filed suit against one of Boogie’s former customers. The suit was settled.
After reaching the settlement, the trustee sought a declaration in the bankruptcy court that the SBA did not have an interest in the proceeds of the settlement that was superior or prior to the rights of the trustee. The SBA contended, as it does on appeal, that a financing statement filed in 1983 pursuant to Cal. Comm.Code…