Waldschmidt v. Federal Deposit Insurance Corp. (In Re Preston)

MEMORANDUM

KEITH M. LUNDIN, Bankruptcy Judge.

The question presented is whether the Federal Deposit Insurance Corporation (“FDIC”) has a security interest in the debtor’s interest in the second of two trusts where the security agreement and financing statement mistakenly identify the first trust and the assets underlying the transaction were transferred to the second trust before the security agreement was executed. For the reasons stated below, we hold that the trustee defeats the FDIC’s claim of a security interest in the second trust.

I

At some time prior to 1980 1 Thomas Beasley, Boyd Adams…