Howell Enterprises, Inc. (Howell) (plaintiff), a rice mill, took out a loan from the First National Bank of Stuttgart, Arkansas (the Bank) and gave the Bank a security interest in its accounts receivable. Bar Schwartz Limited (Bar Schwartz) wanted to buy rice from Howell using a commercial letter of credit, which Howell refused to accept. Bar Schwartz would not buy from Tradax America, Inc. (Tradax), so Howell and Tradax agreed that Tradax would use Howell’s name to sell the rice. In its books, Howell included the contract with Bar Schwartz in its accounts receivable. Bar Schwartz gave Howell the letter of credit, which was to be paid to Tradax on maturity. Before then, Howell entered Chapter 11 bankruptcy. The Bank asserted its perfected security interest in Howell’s accounts receivable. Tradax sued, arguing that the Bar Schwartz transaction was not an account receivable or that the letter was held in constructive trust. The bankruptcy court concluded that Tradax had an equitable interest and that the letter of credit was held in constructive trust for its benefit, but that the Bank had a perfected security interest in the letter and was a bona fide purchase for value. Thus, the court awarded the letter to the Bank, and Tradax appealed to the United States Court of Appeals for the Eighth Circuit.