In Re Rittenhouse Carpet, Inc.

OPINION

EMIL F. GOLDHABER, Chief Judge:

The predominant issue in the case before us is whether 11 U.S.C. § 365(e) of the Bankruptcy Code (“the Code”) prohibits the operation of state laws providing that the mere filing of a petition under the Code causes the immediate removal of a debt- or/partner from a partnership. On the basis of § 365(e) and the Supremacy Clause of the U.S. Constitution, we conclude that removal of a debtor/partner may not be predicated merely on the filing of a petition in bankruptcy, notwithstanding provisions of state law to the contrary.

We summarize the facts of this…