Dissenting Opinion

GARRECHT, Circuit Judge

(dissenting).

The facts as found by the lower court which are supported by the evidence establish collusion and fraud. Further, under *4the circumstances disclosed in this case, appellants were under equitable obligation not to overreach the debtor and unsecured creditors as was done. The decree of the District Court should be affirmed.

Lead Opinion

DENMAN, Circuit Judge,

The petition for rehearing asserts that jke opjn;on 0f the court in effect finds that j.jle t>Qnc[g were sold by the bondholders’ committee to the Pacific States as a result of fraudulent conspiracy and then ignores its finding in reaching its conclusions. No such inference from the findings is warranted. The dealings between the bondholders’ committee and the Pacific States were free from any obligation, legal or equitable, to the debtor. In the absence of any lawful obligation to the debtor, the purchase of the bonds is not converted into a fraudulent conspiracy because one or all the negotiators had a motive, however unethical in character, which would be satisfied by the fact that the lawful profit, if made, would exhaust the proceeds of the sale of the security given by the debtor corporation and leave nothing for it and its stockholders. It is not incumbent upon the court to assess the justification or lack of it, for the personal resentments between the representatives of the two syndicates after months of hostile negotiation,

Pétition for rehearing denied,