In Re American Hardwoods, Inc., Debtor. American Hardwoods, Inc. v. Deutsche Credit Corporation

American Hardwoods, Inc. (American) appeals from a district court order affirming the bankruptcy court’s partial summary judgment in favor of Deutsche Credit Corporation (Deutsche). American argues that the bankruptcy court erred in holding that it lacked both jurisdiction and power to enjoin Deutsche permanently from enforcing a state court judgment against Craig and Gabriele Keeler (the Keelers), who are nondebtor guarantors of American’s liabilities to Deutsche. The district court had jurisdiction pursuant to 28 U.S.C. § 158 (a) and we have jurisdiction pursuant to 28 U.S.C. § 158 (d). We affirm.

I

The Keelers are the president and vice president of American, which manufacturers hardwood veneer and veneer-faced plywood. To manufacture its plywood, American uses large machinery, which was financed by Deutsche. The Keelers initially purchased this machinery then transferred it to American in consideration for the company’s assumption of liability for the debt.

On December 9, 1986, Deutsche obtained an order in Oregon state court permitting Deutsche to seize American's machinery. In response, American filed a voluntary petition for bankruptcy under Chapter 11 of the Bankruptcy…