CERx Pharmacy Partners, LP v. Provider Meds, LP (In re Providerx of Grapevine, LLC)
507 B.R. 132
| Bankr. N.D. Tex. | 2014Background
- CERx loaned about $8.92M to Provider Meds, LP under May 6, 2011 loan documents (PSA, Term Sheet, Convertible Note, Collateral Assignments).
- PI assets pledged: Patent Applications and related IP; language in PSA and Term Sheet governing scope of security interests.
- CERx filed a UCC-1 Financing Statement with Texas authorities describing Patent Applications; non-patent IP not clearly specified.
- CERx issued a Transmittal Letter and a Notice of Disposition (Dec. 13, 2012) regarding disposition of collateral; sale conducted publicly.
- CERx purchased PM’s IP Assets at the December 13, 2012 sale; PM’s bankruptcy petition followed; Trustees contested aspects.
- Original Memorandum Opinion (Aug. 2, 2013) held non‑patent IP unperfected and subject to 544(a) avoidance; reconsideration granted on issues of notice scope and disposition.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did PM grant CERx a security interest in all PM IP Assets? | CERx argues broad grant under Term Sheet and PSA. | PM/Trustees contend only Patent Applications were covered. | Yes, as clarified on reconsideration. |
| Was CERx properly perfected in PM’s non-patent IP assets? | CERx contends sufficient to perfect broader IP. | UCC-1 limited to Patent Applications; non-patent IP not perfected. | No; perfection limited to Patent Applications. |
| Was CERx's Notice of Disposition valid to support sale of IP assets? | Notice together with Transmittal Letter gave actual notice. | Notice deficiencies could affect damages but not void sale. | Disposition valid; sale upheld. |
| Does the strong-arm power under 11 U.S.C. § 544 apply to the IP Assets? | CERx’s prepetition sale should be avoided by trustee. | Sale occurred prepetition; not a property of PM’s estate. | Not availing strong-arm rights; sale not avoided. |
| Is the Source Code ownership issue (PM vs OnSiteRx) for trial? | CERx contends PM owned Source Code; rights implicated. | OnSiteRx ownership; disputes unresolved. | Genuine issue of material fact remains for trial. |
Key Cases Cited
- Looney v. Nuss, 545 F.2d 916 (5th Cir.1977) (objective intent to grant security may be inferred from multiple documents)
- Crow-Southland v. North Ft. Worth Bank., 838 S.W.2d 720 (Tex.App.-Dallas 1992) (collateral descriptions affect inquiry notice in financing statements)
- In re Casbeer, 793 F.2d 1436 (5th Cir.1986) (strong-arm consideration in bankruptcy security interests)
- Frost Nat’l Bank v. L & F Distribs., 165 S.W.3d 310 (Tex.2005) (contract interpretation—consider entire writing and business context)