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In Re Automation Solutions International, LLC

274 B.R. 527 (2002)

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In Re Automation Solutions International, LLC

United States Bankruptcy Court for the Northern District of California
274 B.R. 527 (2002)

  • Written by Philip Glass, JD

Facts

After filing for Chapter 11 bankruptcy, Automation Solutions International, LLC (Automation) (debtor) sold its business asset IDC to Danaher Corporation (Danaher) (creditor) in the ordinary course of business. This asset disposition, validated by the court, was made free and clear of five liens and included the assumption and assignment of six equipment leases. Danaher submitted a 15-page proposed order that attempted to adjudicate prospective disputes and improper claims without notice or service of process to potential disputants. Moreover, the order included a provision exempting the sale from taxation under 11 U.S.C. § 1146(c), which exempts from taxation the transfer of a security. This provision failed to provide notice to the taxing authority. The bankruptcy court determined the extent to which Danaher’s proposed order should be modified before approval.

Rule of Law

Issue

Holding and Reasoning (Jaroslovsky, J.)

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