Creditors' Committee of Trantex Corp. v. Baybank Valley Trust Co. (In Re Trantex Corp.)

MEMORANDUM AND ORDER ON DEFENDANT’S MOTION TO STRIKE

PAUL W. GLENNON, Bankruptcy Judge.

Trantex Corporation (“Trantex”) filed an original petition for an arrangement under Chapter XI of the Bankruptcy Act on June 14, 1979. On February 5, 1980, the Creditors’ Committee of Trantex (the “Committee”) commenced this action against the BayBank Valley Trust Company (the “Bank”) to have the Bank’s secured claim against Trantex subordinated to the claims of all general creditors. The gravamen of the complaint is that the bank, by reason of its secured position, coerced the directors of Trantex into…