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  5. 591 F.2d 148 (1978)
 

MATTER OF STIRLING HOMEX CORP.

Nos. 49, 243, Dockets 78-5025, 78-5039.

591 F.2d 148 (1978)

In the Matter of STIRLING HOMEX CORPORATION, Consolidated Debtor. STATE OF NEW YORK, Appellant, v. Frank G. RAICHLE, Reorganization Trustee, Appellee.

United States Court of Appeals, Second Circuit.

Decided November 22, 1978.

As Modified on Rehearing January 30, 1979.

Attorney(s) appearing for the Case

John M. Farrar, Asst. Atty. Gen., New York City (Louis J. Lefkowitz, Atty. Gen. of the State of New York, Samuel A. Hirshowitz, First Asst. Atty. Gen., Robert L. Schonfeld, Asst. Atty. Gen., New York City, of counsel), for appellant-claimant.

Byron Johnson, Rochester, N. Y. (Johnson, Reif & Mullan, P. C., Rochester, N. Y., Kenneth K. Doolittle, Rochester, N. Y., on the brief), for appellee-trustee.

Before OAKES, GURFEIN and MESKILL, Circuit Judges.

OAKES, Circuit Judge:

It has been said that "reorganizations under Chapter X . . . involve some of the law's most difficult problems of analysis, adjustment of rights, and litigation."1 The present consolidated appeal is no exception. Here the State of New York appeals from two orders of the United States District Court for the Western District of New York sitting as a bankruptcy court in Chapter

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