Second Circuit Holds That Assignees Have Standing Under New York Law as Secured Creditors

Second Circuit Holds That Assignees Have Standing Under New York Law as Secured Creditors | Michael L. Moskowitz

By Michael L. Moskowitz and Melissa A. Guseynov

In an unpublished opinion dated July 19, 2017, the Court of Appeals for the Second Circuit (“Second Circuit”) denied a petition for rehearing of a decision by the District Court for the Western District of New York granting standing of an assignee’s rights to enforce individual notes and mortgages. The Court affirmed, among other things, that commercial lenders that advanced money and obtained assignments to pay off the loans of a chapter 11 debtor from individual lenders were entitled to file proofs of secured claims in the debtor’s bankruptcy case, regardless of whether the assignments were properly transferred.  Arnold v. First Citizens National Bank, 2017 WL 3049414 (2d. Cir. July 19, 2017).

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