Opinion ID: 1211144
Heading Depth: 2
Heading Rank: 4

Heading: Memorandum Decision and Order of the District Court

Text: In September 2006, G & C filed in the District Court a motion for summary judgment, seeking a determination that Roslyn did not possess a perfected security interest in the Fund. Roslyn filed a cross-motion for summary judgment. In its motion for summary judgment, G & C, relying on the New York Uniform Commercial Code, characterized Roslyn's security interest in the USPS Judgment as an interest in money or proceeds from the USPS Judgment  and not in the judgment itself and the rights thereto. Thus, according to G & C, Roslyn did not possess a perfected security interest in the money that now constitutes the Interpleader Fund because a security interest in money is perfected only when the holder of the interest is in actual possession of the money. Id. at . G & C argued that if Roslyn did not hold a perfected interest, then the judgment lien of G & C, the judgment liens of the other judgment-creditor claimants, and the liens and secured interests of the other claimants to the Interpleader Fund would, as a matter of law, have priority over the claim of Roslyn. [2] Id. In its Memorandum Decision and Order dated December 18, 2006, the District Court granted Roslyn's cross-motion for summary judgment. The District Court rejected G & C's argument that Roslyn did not have a perfected security interest in the Interpleader Fund. In so doing, the District Court observed that N.Y. Gen. Oblig. Law § 13-103 provides that a judgment for a sum of money can be transferred and that [s]uch a transfer has been held to be a transfer of a present interest, even if the judgment is the subject of an appeal. Abcon Assocs., 2006 WL 3751261, at  (citing Law Research Serv. Inc. v. Martin Lutz Appellate Printers, Inc., 498 F.2d 836, 839 (2d Cir.1974)). Thus, the District Court found that [a]s an interest in an existing judgment, Roslyn's interest in the USPS Judgment [was] a present interest in a judgment and not a future interest in money yet to be received. Id. As such, the District Court stated that Roslyn need not be in actual possession of the money in the Fund to perfect its security interest. Id. The District Court further observed that, as an interest in a judgment, Roslyn's lien is specifically exempt from the filing requirements of the UCC. Id. (citing N.Y. U.C.C. Law § 9-109(d)(9)). Accordingly, the date upon which the loan documents were executed, [March 12, 2002], and not the date of the filing of the UCC-1 [(April 12, 2002)], is the date when Roslyn's interests became a lien. Id. The District Court concluded: Roslyn's interest in the Fund was created as of March 12, 2002. That interest was an interest in a judgment, properly transferred under New York law. Accordingly, [Roslyn] has priority over all other claimants. Id. G & C's motion for reconsideration was denied on March 29, 2007, United States v. Abcon Assocs., No. CV 05-3178(LDW), 2007 WL 1026418 (E.D.N.Y. Mar.29, 2007), and the District Court entered its Order for Distribution of the Interpleader Fund on August 13, 2007. [3] This timely appeal followed.