The creditor’s line belonged to the Bankruptcy Court, 3rd Circ. Said

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By Jeannie O’Sullivan (March 23, 2022, 4:10 p.m. EDT) — A Mitsubishi finance arm on Wednesday urged the Third Circuit to overturn a $1.5 million judgment awarded to a finance company co-creditor in bankruptcy, arguing the matter should have been filed in the same place as the company’s Chapter 11 case.

During oral argument, an attorney for Hitachi Capital America Corp. said the New Jersey District Court never had jurisdiction over co-creditor CoFund II LLC’s lawsuit stemming from the parties’ agreement specifying the relative priority of their collateral interests in the bankrupt business.

There was a substantial “overlapping” of issues in the CoFund breach lawsuit and a dispute between creditors being…

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