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IN RE MILLIVISION, INC.

No. 06-9006.

474 F.3d 4 (2007)

In re MILLIVISION, INC., Debtor. David W. Ostrander, Chapter 7 Trustee, Plaintiff, Appellee, v. Michael Gardner and Roy Furman, Defendants, Appellants.

United States Court of Appeals, First Circuit.

Decided January 16, 2007.

Attorney(s) appearing for the Case

Melvin S. Hoffman, with whom Pamela A. Harbeson and Looney & Grossman LLP were on brief for appellants.

David W. Ostrander, with whom Ostrander Law Office was on brief for appellee.

Before TORRUELLA, Circuit Judge, CYR, Senior Circuit Judge, and LYNCH, Circuit Judge.

CYR, Senior Circuit Judge.

On December 11, 2003, Michael Gardner and Roy Furman, while negotiating to acquire the assets of Millivision, Inc., loaned Millivision $500,000 with which to pay its essential debts and avoid an operational shutdown. The next day, Millivision's creditors filed an involuntary chapter 11 petition. Unaware of the chapter 11 filing, Gardner and Furman did not record a financing statement relating to their loan until December 16. The bankruptcy...

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