In the Matter of Kmart Corp

question 203

Multiple Choice

In the Matter of Kmart Corp., where some creditors objected to the bankruptcy judge decision that "critical vendors" were to be paid first so that the store might stay in business, the appeals court held that:

• A) the record showed the prospect or benefit to the other creditors, which is necessary to allow the preferential payment of one class of creditors and so the critical-vendors order could stand
• B) the record did not show the prospect or benefit to the other creditors, which would be necessary to allow the preferential payment of one class of creditors and so the critical-vendors order could not stand
• C) the record did not show the prospect or benefit to the other creditors, which would be necessary to allow the preferential payment of one class of creditors but the critical-vendors order could stand anyway
• D) the record showed the prospect or benefit to the other creditors, which is necessary to allow the preferential payment of one class of creditors, but the critical-vendors order could not stand due to the special circumstances of the case
• E) the creditors who objected were unreliable and so should not be paid

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Definitions:

French

Relating to France or its people, language, or culture.

Belgian Imports

Goods and services purchased from Belgium by other countries, including chocolates, diamonds, beers, and pharmaceutical products.

American Labor Union

An organization that represents the interests of workers in various industries, advocating for better wages, working conditions, and rights in the United States.

Industrial Workers Of The World

An international labor union founded in 1905, known for its radical approach to workers' rights and socialism.