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Message: <blockquote data-quote="MSWallack" data-source="post: 9696988" data-attributes="member: 48170">I am a lawyer, but very definitely not a bankruptcy lawyer. I did a very quick bit of research, and it appears that this is an area of law in which there has been quite a bit of confusion. The two things that stood out to me about the definition of "Consignment" in UCC Section 9-102(20) are the requirement (in subsection (A)(iii)) that the merchant (Diamond) "is not generally known by its creditors to be substantially engaged in selling the goods of others" and the requirement (in subsection (C)) that the "the goods are not consumer goods immediately before delivery". Here, there can't be any real dispute that Diamond's creditors knew that it was in the business of selling the goods of others; that was Diamond's core business. And the goods that Diamond had and sold for others were consumer goods. Thus, I'm not sure (again, this isn't my area of law...) that the transaction actually qualifies as a consignment under UCC Section 9-102(20) for which a UCC-1 financing statement was necessary. You can't fault Chase and other creditors of Diamond from trying to get as much money from the bankruptcy estate as possible, but I think (again, recall the caveat) that the publisher's have strong arguments against the loss of the property due an unsecured consignment transaction.Also, I thought that this was a good article on the subject (from 2019): <a href="https://www.mayerbrown.com/-/media/files/perspectives-events/publications/2019/07/070081901-mayer.pdf" target="_blank">https://www.mayerbrown.com/-/media/files/perspectives-events/publications/2019/07/070081901-mayer.pdf</a>.</blockquote>

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