Debtors in four cases filed complaints against Avco seeking to avoid its liens on their personal property, and Avco moved to dismiss. The court considered whether the 11 U.S.C. § 522(f)(2) lien avoidance provisions applied to security interests created prior to enactment of the Bankruptcy Code, and if so, whether the provisions were constitutional. The court explained that § 522(f)(2) was intended to avoid nonpossessory, non-purchase money liens to the extent they impair exemptions for certain living necessities, tools of trade, and health aids, then concluded that both the statute's language and legislative analysis indicated that § 522(f) was intended by Congress to be retroactive. In considering whether retroactive application of the statute was constitutional, the court concluded that no substantive due process rights outweighed the congressional power to regulate bankruptcies. At most, the court held that the Constitution required a rational connection between § 522(f) and the purpose of its enactment, which was to eliminate certain "evils" in the credit industry. The court held that, under the presumption of constitutionality that was afforded the statute, it would be inappropriate to conclude that § 522(f) does not rationally relate to that purpose and, therefore, the statute was constitutional. Avco's motions to dismiss were denied.

Debtors purchased two motorcycles from lender pursuant to a purchase money security agreement, which was never perfected. In debtors' chapter 7 proceeding, trustee filed an adversary complaint against lender seeking to set aside its interest under 11 U.S.C. § 544, and to preserve the lien for the estate under 11 U.S.C. § 551. Lender stipulated to the relief sought by trustee. The court ruled that trustee's hypothetical judicial lien was automatically preserved for the estate by § 551, but that debtors were still subject to lender's contractual claim. Debtors claimed an exemption in the motorcycles under 11 U.S.C. § 522(d)(5), which the court determined would not be available to them unless they established an "aggregate interest" in the property, which would require them to either avoid lender's lien, which still bound them under state law and exceeded the property's value, or obtain the benefit of trustee's avoidance of that lien. Such powers would only be provided by the exemption statute, and the court considered subsections (c), (f), (g), and (h) of § 522, concluding that none of those provisions would allow debtors' to claim an exemption.

Debtors sold a home in Washington state to plaintiffs, who incurred expenses getting the home up to code. In a state court action, plaintiffs obtained a judgment against debtors, in which that court found that debtors had "materially misrepresented the condition of" the home, which proximately caused plaintiffs' damages. Debtors filed a bankruptcy petition, and plaintiffs filed a complaint in the bankruptcy court under 11 U.S.C. § 523(a)(2), alleging their judgment was non-dischargeable. The court noted that, based on principles of res judicata, a valid final judgment could not be re-litigated. However, when the issue between the parties is dischargeability, res judicata is inapplicable, but collateral estoppel might bar the re-litigation of issues that were litigated to the same standards that apply in bankruptcy. Comparing Washington state law misrepresentation standards with the standards of § 523(a)(2), the court concluded the standards were essentially the same. Therefore, plaintiff's motion for summary judgment was granted.

Trustee sought to set aside debtors' transfer of their residence to their son, as a fraudulent transfer. The court concluded that, at the time of the transfer, debtors did not intend or believe that they would incur debts beyond their ability to pay and, therefore, trustee's 11 U.S.C. § 107d(2)(c) claim failed. The issues with respect to trustee's claim under § 107d(2)(a) were whether debtors were rendered insolvent by the transfer and whether fair consideration was paid by their son. The court found that debtors were rendered insolvent by the transfer of the property, and that son's assumption of a $25,000 first mortgage on a $62,000 property was not fair consideration, and refused to include the value of a life estate in the property as part of son's consideration, as no written agreement had been produced that created such a property right in debtors.