Donarumo v. Furlong, No. 11-1364 (1st Cir. 2011)
Annotate this CaseIn 2005 the debtor business purchased a business and signed a promissory note. The business failed, allegedly because the seller continued to compete, in violation of the contract. The debtor listed a breach of contract claim as an asset. The trustee was unable to retain an attorney to pursue the claim and, with the limitations period running out, the court approved abandonment of the claim. The seller then offered to buy the claim and stock in the debtor company. The First Circuit affirmed the district court holdings that the claim had been abandoned (11 U.S.C. 554(c)), but that the stock had not been abandoned. Although the debtor did not identify eery possible theory of recovery in listing the claim as an asset, the trustee was on notice of tort theories. The transfer of the claim was not a violation of the automatic stay.
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