In re Boscov’s, Inc.
November 28, 2008
In a recent hearing to consider the sale of the Boscov’s department store chain, the United States Bankruptcy Court for the District of Delaware held that Boscov’s private label credit card program agreement was not a "contract to make a loan or extend a financial accommodation" and therefore could be assumed and assigned in the sale. In re Boscov’s, Inc., Case No. 08-11637 (KG) (Bankr. D. Del. November 21, 2008). The opinion is noteworthy because although two courts of appeal have already held that credit card processing agreements are not "contracts to make a loan or to extend a financial accommodation," the agreement here was more than just a processing agreement and contemplated the actual extension of hundreds of millions of dollars of credit to Boscov’s customers every year.
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