O’Donnell, et. al. v. Tristar Esperanza Properties, LLC (In re Tristar Esperanza Properties, LLC)

By Los Angeles Bankruptcy Attorney on March 9, 2013

The U.S. Bankruptcy Appellate Panel of the Ninth Circuit ("BAP") held that a judgment awarding the value of a withdrawing member’s interest in an LLC constitutes “damages arising from the purchase or sale of… a security” under 11 U.S.C. § 510(b), and therefore is vulnerable to mandatory subordination. O’Donnell, et. al. v. Tristar Esperanza Properties, LLC (In re Tristar Esperanza Properties, LLC), BAP No. CC-12-1340-KlPaDu (9th Cir. BAP Mar. 8, 2013). To read the opinion, click here: (Tristar) http://cdn.ca9.uscourts.gov/datastore/bap/2013/03/08/Tristar12-1340.pdf