International Fidelity Insurance Company v. United States

ARNOLD, Circuit Judge.

This is a dispute over who is entitled to two progress payments earned by a contractor, Prudential Construction Systems, Inc., which defaulted on its obligation to install drywall at a construction site. The government, on behalf of the Internal Revenue Service, claims that it is entitled to the funds because Prudential has an outstanding tax debt. International Fidelity Insurance Company, which assumed Prudential’s obligations after it defaulted, claims that it is entitled to the payments as Prudential’s surety on the construction contract. Responding to cross-motions…