The State of Texas v. Wellington Resources Corp. And Whitehall Mining Co., Inc.

TATE, Circuit Judge:

This appeal arises out of consolidated bankruptcy proceedings of two related corporations, Wellington Resources Corporation and Whitehall Mining Company, Inc. (“the debtors”). The State of Texas filed an application to release certain property of the debtor corporations over which it had exercised jurisdiction prior to the bankruptcy proceedings through institution of a securities fraud case enjoining any disposition of these assets, based partly upon allegations that the property at issue had been acquired through fraudulent practices. The bankruptcy court denied the…