Chicago Tribune bankruptcy - repossessing equipment

You should hire a bankruptcy attorney in the state where the Chicago Tribune filed its petition for bankrutcy. You should ask that bankruptcy attorney to file a pettition on behalf of you as a secured creditor for the repossession of the equipment.

Without reviewing the contract it would be impossible for any attorney to inform you if you have an automatic right to repossession.

Disclaimer. Ms. Marsh is an attorney licensed to practice in California. The information posted above is for general information, does not constitute professional legal advice, and does not create an attorney client relationship.

Ms. Marsh strongly advises the questioner to consult with an attorney to thoroughly review the contract and for advice tailored to his or her specific circumstances.

You require specific legal advice and should not rely on general information provided in response to a question posted on Avvo. Given the value of the equipment and the potential complexity of the matter, you should consult with a bankruptcy attorney to discuss the particulars of your matter and for any specific legal advice.

In order to have a perfected purchase money security interest in goods sold, the seller must file a financing statement with the Secretary of State in the state in which the buyer is organized. In this case, I believe that this would have been Delaware. When a security interest has not been perfected, it can be avoided in bankruptcy. However, in order to avoid your security interest the Tribune Company would have to sue.

Now that the Tribune Co. has filed its bankruptcy petition there is nothing you can do to perfect the security interest. However, it is possible that the Tribune Co. won't sue to avoid the security interest. They have two years from December, 2008 to take that action.

This kind of "phantom" security interest may leave open some possibilities which involve 'waiting out" the next 18 months without showing your hand.

Nothing above should be relied upon. I haven't seen any of the papers. I don't know how unsecured claims are going to fare in the Tribune Co. bankruptcy. And most importantly, I am a Calfornia lawyer and I couldn't give legal advice to anyone other than a California client. You really need to invest a couple of hours with a commercial bankruptcy lawyer to see what to do.

Good luck,

Dean