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Abstract: Prior to bankruptcy, debtor All Resort Group paid its principals’ federal tax debts to the Internal Revenue Service. The bankruptcy trustee subsequently sought to avoid those transfers using a Bankruptcy Code provision that allows the trustee to avoid a transfer that is voidable under state law by an actual creditor. The United States objected, arguing that because sovereign immunity would have precluded relief under state law, the trustee could not obtain a different result in bankruptcy.
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