Securities and Exchange Commission, Appellee, v. Flight Transportation Corporation, Ftc Executive Aircharter, Inc., Ftc Cayman Ltd., and William Rubin, Appellees;greyhound Leasing & Financial Corporation, Joyce Rubin,continental Illinois National Bank & Trust Co. of Chicago,fifth Northwestern National Bank of Minneapolis, Duncanaviation, Inc., Gates Learjet Corporation, and Bellhelicopter Textron, Inc., Appellants, 693 F.2d 66 (8th Cir. 1982)

Robins, Zelle, Larson & Kaplan, Howard A. Patrick, Robert M. Wattson, Carol L. Thacher, Faegre & Benson, Duane W. Krohnke, Minneapolis, Minn., for appellant Joyce Rubin.

Gray, Plant, Mooty, Mooty & Bennett, Edward J. Callahan, Jr., Thomas Darling, John L. Krenn, Minneapolis, Minn., for Greyhound Leasing & Financial Corp.

Meshbesher, Singer & Spence, Ltd., Gerald M. Singer, Daniel J. Boivin, Minneapolis, Minn., for appellee William Rubin.

Jack L. Chestnut, Chestnut & Brooks, P.A., Minneapolis, Minn., Daniel Krasner, Wolf, Haldenstein, Adler, Freeman & Herz, New York City, John A. Cochrane, Cochrane & Bresnahan, St. Paul, Minn., Lowell E. Sachnoff, Charles R. Watkins, Sachnoff Weaver & Rubenstein, Ltd., Chicago, Ill., Thomas P. Gallagher, Minneapolis, Minn., for class plaintiffs.

Jacob H. Stillman, Associate Gen. Counsel, Richard A. Kirby, Senior Sp. Counsel, Sarah A. Miller, Elliot M. Pinta, Attys., S.E.C., Washington, D.C., for appellee S.E.C.; Paul Gonson, Sol., Washington, D.C., of counsel.

O'Connor & Hannan, Kevin M. Busch, Thomas C. Bartsh, Minneapolis, Minn., for appellee Flight Transp. Corp.

Before ARNOLD, Circuit Judge, HENLEY, Senior Circuit Judge, and DUMBAULD,^*  Senior District Judge.

PER CURIAM.

The Securities and Exchange Commission, Greyhound Leasing & Financial Corp., and Continental Illinois National Bank & Trust Co. of Chicago et al. have jointly moved for an order allowing this matter to proceed in bankruptcy. The Court has now heard oral argument, including the opposing views of the appellee William Rubin and the intervenors Drexel Burnham Lambert Inc., et al., as well as written views submitted by others, including the receiver for Flight Transportation Corporation and the intervenors referred to as "Class Plaintiffs." The Court makes the following disposition of the motion:

1. The District Court's stay orders of June 20, 1982, July 2, 1982, August 5, 1982, and August 16, 1982, are modified to permit the involuntary Chapter 11 bankruptcy case commenced against Flight Transportation Corporation on June 29, 1982, No. 4-82-1154 in the United States Bankruptcy Court for the District of Minnesota, Fourth Division, to proceed in all respects in the said Bankruptcy Court.

2. This order is without prejudice to the right of any party to raise any issue in any court, including but not limited to the question of which court may decide (1) the claim of disgorgement brought against Flight Transportation Corporation, its subsidiaries, and William Rubin, and (2) the motion to impose a constructive trust on the proceeds of the June 1982 securities offerings, and any defenses thereto.

3. Except as provided in paragraph 4 of this order, the pending appeals Nos. 82-1964 and 82-1990 shall be held in abeyance pending the adjudication by the District Court or the Bankruptcy Court of the motion to impose a constructive trust on the proceeds of the June 1982 securities offerings. If any such trust is imposed, no part of the res thereof may be disbursed without leave of this Court.

4. The appeal of Greyhound Leasing & Financial Corporation from the denial of its motion to intervene shall proceed to decision and shall not be affected by this stipulation.

5. The appeal of Joyce Rubin, No. 82-1976, shall proceed to decision and shall not be affected by this stipulation.

6. During the pendency of these appeals, this Court's previous order shall remain in effect, allowing all claimants on the assets of Flight Transportation Corporation, FTC Executive Air Charter, Inc., FTC Cayman Ltd., and William Rubin, including the appellants in Nos. 82-1964, 82-1976, and 82-1990, to participate in all proceedings in the District Court affecting the assets of these four named appellees.

It is so ordered.