September 2007

Each month, we will update this Industry News section with a quick look at important legislative changes affecting UCC filing.

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September State Office Holiday Schedule:
Day:
3rd Labor Day
State:
All States
UCC News:

Texas – The U.S. Bankruptcy Court for the Southern District of Texas recently announced a decision with respect to the effectiveness of a financing statement. Secured party, AmPac, filed its statement with debtor listed as “JIM ROSS TIRES, INC. dba HTC TIRES & AUTOMOTIVE CENTERS.” Secured party, Tradition Bank, filed its statement designating debtor's name as “JIM ROSS TIRE INC.” The name of the debtor as indicated by the Texas Secretary of State is “Jim Ross Tires Inc.” A search conducted using the standardized search logic did not reveal either filing. The Court, reviewing Texas' iteration of Revised Article 9.503, noted that the code requires the debtor name to be filed exactly as it appears on the public record of the debtor's jurisdiction of organization. AmPac's inclusion of the dba information fatally modified the “the full correct name of a debtor” and hence the search term. Likewise, the Court found that Tradition Bank's omission of the “s” rendered its financing statement ineffective. (In re Jim Ross Tires, Case No. 06-33147).

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