Actual Knowledge of Consignment Blocks Secured Creditor’s Priority Claim

U.C.C. Consignments have been a feature of American retailing for many years. As such, they are addressed in the Uniform Commercial Code and arise in cases from time to time. One such case is TSA Stores, Inc. v. Wilmington Savings Fund Society FSB, 595 B.R. 676 (Bankr.Del.November 26, 2018).

The Sports Authority Holdings, Inc. and its affiliates (the “Debtors”) were national retailers of sporting goods and active apparel. The Debtors developed a prog…