California Public Employees' Retirement System v. Stanton (In Re CP Holdings, Inc.)

KRESSEL, Chief Judge.

The trustee and CP Holdings, Inc. appeal from a bankruptcy court 1 order determining that California Public Employees’ Retirement System held a perfected security interest in the debtor’s claim against Kmart. We affirm.

BACKGROUND

In 1989, the debtor signed a promissory note for $12 million with Principal Mutual Life Insurance Company. Principal endorsed this note to CALPERS, which became the holder of the note at all times material to this case. The debtor secured the note in part by granting a Mortgage and an Assignment of Lease and Rents on three parcels of real estate…