Unsecured Creditors' Committee v. Farmers Savings Bank (In Re Toledo Equipment Co.)

How courts have described this case

Verbatim parenthetical descriptions written by other courts when citing this decision. Ranked by citation-network relevance.

• creditors committee must first make appropriate showing that debtor-in-possession has un justifiably failed to prosecute preference action before commencing action itself
• creditors’ committee is impliedly authorized to bring to bring action if it would benefit and debtor-in-possession has unjustifiably failed to prosecute the case
• Although denying authorization to sue under the facts of the case, the court recognized that under appropriate circumstances an action may be commenced by the creditors' committee.
• where the creditor to whom the alleged preferential transfer was made is a creditor on whom the debtor-in-possession is relying during the course of reorganization, it may not be in the debtor’s best interest to bring a preference action against that creditor
• DIP wished to maintain good relationship with creditor
• creditor must make appropriate showing before commencing action

Source: CourtListener parenthetical corpus (CC0).