A creditor may buy other creditors’ claims for the sole purpose of voting those claims against a Chapter 11 plan to defeat confirmation. The creditor does not act in bad faith so as to void its vote of the purchased claims even though (a) it acts in its own self-interest to protect its secured claim, (b) it doesn’t offer to buy all unsecured claims, but only enough to vote a majority of them by number, and (c) blocking the plan will adversely affect other creditors. To void the vote, the debtor must show that the creditor is seeking to secure some untoward advantage over other creditors for some ulterior motive.
Ninth Circuit Court of Appeals (Smith, N.R., J.); June 4, 2018; 2018 U.S. App. LEXIS 15012