McNellis v. Dubnoff

FEINBERG, Circuit Judge:

This case poses the question whether a trustee in bankruptcy can recover from a creditor principal and interest paid by an insolvent bankrupt to the creditor on allegedly usurious loans. Phillip J. Mc-Nellis, as trustee in bankruptcy of the estate of Donald S. Potter, claimed before the referee in bankruptcy that loans by creditor Herman Dubnoff were tainted with usury. The referee’s decision was in large part favorable to the trustee, but the United States District Court for *514the Northern District of New York, Edmund Port, J., reversed, and remanded the proceedings.…