Hoskins v. Citigroup (In re Viola)
- Citation:
- Ninth Circuit Case No. 12-60032 (July 16, 2014) (Unpublished)
- Tag(s):
-
- Ruling:
- A "transferee” under 11 U.S.C. § 550(a)(1) is one who has legal title to the funds and the ability to use them as the recipient sees fit. This is the "dominion test". Allegations of open and exclusive control through fraudulent misappropriation of funds is insufficient to satisfy the dominion test .
- Procedural context:
- The trustee sought review of a bankruptcy court dismissal of trustee's second amended complaint pursuant to Rule 12(b)(6) that was upheld by the Ninth Circuit BAP.
- Facts:
- Trustee alleged in her second amended complaint that debtor exercised dominion over the accounts because the debtor fraudulently misappropriated his investors’ funds, and the
defendants allowed the debtor “to open and exclusively control” the trust accounts.
- Judge(s):
- SILVERMAN, W. FLETCHER, and BYBEE
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