Hastings State Bank v. Stalnaker, Trustee
United States Bankruptcy Appellate Panel for the Eighth Circuit
431 B.R. 459 (2010)
EDM Corporation was registered with Nebraska's secretary of state under that exact name but was widely known in the industry by its unregistered trade name, EDM Equipment. Hastings State Bank (plaintiff) filed a financing statement identifying EDM as "EDM Corporation d/b/a EDM Equipment," while later creditors TierOne Bank and Huntington National Bank (defendants) correctly identified EDM only as "EDM Corporation." A standard search using EDM's proper name found TierOne's and Huntington's filings but not Hastings's. After EDM went bankrupt, the bankruptcy court found Hastings's filing seriously misleading and ranked TierOne's and Huntington's interests ahead of Hastings's, despite Hastings having filed first.
Whether a creditor can lose priority to later creditors by improperly identifying the debtor's name on a financing statement under the Uniform Commercial Code.