IN RE UNITED MERCHANTS & MFRS., INC.

Arrangement Nos. 77 B 1513-77 B 1888.

3 B.R. 286 (1980)

In re UNITED MERCHANTS AND MANUFACTURERS, INC., et al., Debtors. UNITED MERCHANTS AND MANUFACTURERS, INC. and United Factors, Inc., Plaintiffs, v. UNION BANK, Lloyds Bank of California, Manufacturers Bank, the Chartered Bank of London, Citibank International, Crocker National Bank, Crocker United Factors, Inc., San Francisco Shirt Works, Troy of California International, Wilshire Bedding Co., Inc., Allie B., Inc., Fantastic International, Monarch Knit & Sportswear, Inc., Kennington Ltd., Inc., and K.W. International, Inc., Defendants.

United States Bankruptcy Court, S.D. New York.

March 25, 1980.


Attorney(s) appearing for the Case

Levin & Weintraub, New York City, for debtor by Michael J. Crames, Mitchell Perkiel and Myron Trepper, New York City, of counsel.

Stroock & Stroock and Lavan, New York City, Gen. Counsel for debtor by Lawrence Handelsman and Alan Kolod, New York City, of counsel.

Hahn, Hessen, Margolis & Ryan, New York City, for Crocker National Bank and Crocker United Factors, Inc. by Michael S. Landes, Gabriel B. Schwartz and Samuel J. Reiser, New York City, of counsel.

Shearman & Sterling, New York City, for Citibank International Los Angeles and Fantastic International of California by Mark P. Zimmett and George J. Wade, New York City, of counsel; and Graham & James, Los Angeles, Cal., by Edward J. Eckert, Los Angeles, Cal., of counsel.

Natanson, Reich & Barrison, New York City, for Wilshire Bedding Co., Inc. by George Natanson, New York City, of counsel.

Gendel, Raskoff, Shapiro & Quittner, Los Angeles, Cal., for Lloyd Bank California and co-counsel for Manufacturers Bank, San Francisco Shirt Works, Chartered Bank of London, Allie B., Inc. and Troy of California by Arnold M. Quittner, Bernard Shapiro and Richard S. Berger, Los Angeles, Cal., of counsel.

Cohen, Freeman & Broker, Los Angeles, Cal., for Union Bank, Monarch Knit & Sportswear, Inc. and Kennington, Limited by Lee J. Cohen and Barry V. Freeman, Los Angeles, Cal., of counsel.

Schwartz, Alschuler & Grossman, Los Angeles, Cal., for Manufacturers Bank and co-counsel for San Francisco Shirt Works by Bruce Warner and Robert A. Schlachter, Los Angeles, Cal., of counsel.


OPINION

ROY BABITT, Bankruptcy Judge:

The debtor, United Merchants and Manufacturers, Inc. (UM&M) and most of its subsidiaries, filed separate petitions in this court on July 12, 1977 seeking the benefits of the provisions of Chapter XI of the nowrepealed 1898 Bankruptcy Act. Sections 301 et seq., 11 U.S.C. (1976 ed.) §§ 701 et seq.1 In the course of the unfolding of the scheme of Chapter XI, a unitary...

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