Choate Wins Bankruptcy Appeal for Wells Fargo Against hhgregg

Choate recently secured an appellate victory in its defense of claims brought against Wells Fargo arising out of the bankruptcy of hhgregg, a now defunct Midwestern big box retailer. On February 11, 2020, the U.S. Court of Appeals for the Seventh Circuit affirmed a decision from the U.S. District Court for the Southern District of Indiana, which in turn affirmed the dismissal of reclamation claims brought by Whirlpool Corporation against Wells Fargo.

The Seventh Circuit’s ruling is the first appellate decision to address a developing split of authority concerning the relative priority of reclamation claims under the Bankruptcy Code.