In In re KarcreditLLC [1], the U.S. Bankruptcy Court for the Western District of Louisiana was faced with two lenders with claims to one original stock certificate as collateral.

In a recent decision by the influential Third Circuit Court of Appeals, In re KB Toys Inc., 2013 U.S. App. LEXIS 23083 at *17 (3d Cir. Nov. 15, 2013), the Court decided that “the cloud on the claim” stemming from a preferential payment made to the original claimant continues with the claim, which then could be disallowed.