In re Ehring
United States Court of Appeals for the Ninth Circuit
900 F.2d 184 (1990)
Western Community Moneycenter (Western) (defendant) held a second deed of trust on Ehring's (plaintiff) property after Ehring defaulted; Western purchased the property at a trustee's sale for about $200,000 (the amount of Ehring's debt) and, about a month later, agreed to sell it to the Millers for $390,000. Ehring filed for bankruptcy about a month after that, and sued under Bankruptcy Code §547 to recover the difference between the resale price and the debt, arguing the sale to the Millers was an avoidable preferential transfer; the bankruptcy court granted Western summary judgment, and the bankruptcy appellate panel affirmed.
Whether a creditor's purchase of property at a regularly conducted foreclosure sale, made within 90 days of the debtor's bankruptcy filing on account of an antecedent debt while the debtor was insolvent, is an avoidable preferential transfer when the creditor later resells the property at a substantial profit.