          United States Court of Appeals
                     For the First Circuit

No. 10-2284

                  IN RE AMERICAN CARTAGE, INC.,

                             Debtor.

                      ____________________

                      CITY SANITATION, LLC,

                           Appellant,

                               v.

      ALLIED WASTE SERVICES OF MASSACHUSETTS, LLC, ET AL.,

                           Appellees.


          APPEAL FROM THE UNITED STATES DISTRICT COURT

                FOR THE DISTRICT OF MASSACHUSETTS

         [Hon. F. Dennis Saylor IV, U.S. District Judge]


                             Before

                   Howard, Selya and Thompson,
                         Circuit Judges.


     Marshall F. Newman, with whom Newman & Newman, P.C. was on
brief, for appellant.
     Euripides Dalmanieras and John A. Burdick, Jr., with whom
Kenneth S. Leonetti, Foley Hoag LLP, D. Ethan Jeffery, and Murphy
& King, P.C. were on consolidated brief, for appellees.



                         August 31, 2011
           SELYA, Circuit Judge.       This appeal is the culmination of

a pitched battle between two waste-disposal firms, squabbling over

the carcass of a third.       The littered battlefield brings to mind

the familiar adage that one man's trash is another man's treasure.

           Telling the tale requires us to resolve questions of

standing to prosecute claims arising out of a bankruptcy; questions

of first impression as to the distinction between "commercial tort

claims" and "proceeds" and as to the force and effect of Bankruptcy

Rule 8006; and a question anent the fairness of a negotiated

settlement.     After careful consideration, we conclude that the

disputed claims are commercial tort claims; that the trustee in

bankruptcy had exclusive standing to pursue and settle those

claims; that the appellant, by failing to comply with Bankruptcy

Rule   8006,   waived   its   theory   of   abandonment;   and   that   the

bankruptcy court's approval of the proposed settlement was within

the realm of its discretion.      Accordingly, we affirm the judgment

below.

I.   BACKGROUND

           This case arises out of the ashes of American Cartage,

Inc., a waste-disposal firm.       During its halcyon days, American

Cartage borrowed money from Financial Federal Credit, Inc. (FFC) to

finance its operations and defray the cost of acquiring needed

equipment.     In return, it gave FFC promissory notes and a security




                                   -2-
interest in the purchased equipment (the Equipment Collateral).

The security interest extended to

              all goods, inventory, equipment, accounts,
              accounts receivable, chattel paper, documents,
              instruments,    contract    rights,    general
              intangibles, investment property, securities
              entitlements, deposit accounts, fixtures and
              other property, wherever located, now or
              hereafter belonging to [American Cartage] . .
              . and in all proceeds, insurance proceeds,
              substitutions, replacement parts, additions
              and accessions of and/or to all of the
              foregoing.

              On July 23, 2003, American Cartage filed a voluntary

bankruptcy petition under Chapter 11, see 11 U.S.C. § 301, and

moved   for    leave   to   continue    business   operations   during   the

reorganization period.        The bankruptcy court granted replacement

liens for the secured creditors (including FFC) and allowed the

debtor to use a specified amount of cash collateral for payroll and

other post-petition expenses.

              Within two weeks, the United States Trustee filed an

emergency motion seeking either to dismiss the case or to convert

it to a straight Chapter 7 bankruptcy.          See id. §§ 701-727.      This

motion was sparked by the debtor's failure to obtain commercial

liability      insurance    covering    its   ongoing   operations.      The

bankruptcy court responded by directing that a Chapter 11 trustee

assume responsibility for the debtor's affairs.           Soon thereafter,

the court approved the appointment of John Burdick as trustee.




                                       -3-
            Up to this point, William Zoll had managed the debtor's

day-to-day operations. The trustee sought and received the court's

blessing to retain Zoll as a consultant.      With Zoll's help, the

trustee continued to run the business while attempting to construct

a viable reorganization plan.

            By January of 2005, the trustee had despaired of any

reorganization and moved to convert the proceeding to a Chapter 7

liquidation. Zoll, with the trustee's assent, engaged Allied Waste

Services of Massachusetts, LLC (Allied) to service the debtor's

remaining customers during the wind-up period.

            Faced with this new reality, FFC sought relief from the

automatic stay, id. § 362, in order to take possession of the

Equipment Collateral, including garbage trucks and industrial-sized

trash containers.    FFC wanted to sell this equipment to a rival

trash hauler.    The trustee did not oppose FFC's motion.

            On February 7, 2005, the bankruptcy court converted the

proceeding, assured continuity by appointing Burdick as the Chapter

7 trustee, lifted the automatic stay to the extent requested, and

ordered the debtor to turn over the Equipment Collateral to FFC.

With no further business to be done, the trustee terminated Zoll's

contract.    Zoll subsequently obtained employment with Allied.

            Approximately one month later, FFC again moved for relief

from the automatic stay.    This time, it sought to take possession

of, and sell, the remaining assets in which it held a security



                                 -4-
interest (the Other Collateral). FFC represented that it had found

a buyer willing to pay $142,500 for the Equipment Collateral and

the Other Collateral as a package.            The trustee assented to the

motion on the condition that the bankruptcy estate receive a

$12,500 carve-out for administrative expenses. FFC agreed, and the

bankruptcy court granted the motion, entering a form of order

prepared by FFC.

            FFC foreclosed on the assets and sold them to Todesca

Equipment    Company,      which   resold   them   to   the   appellant,     City

Sanitation, LLC (City).

            In February of 2007, City filed a state court action

against   Allied     and   Zoll.     Posturing     itself     as   the   debtor's

successor in interest, it alleged that Zoll, while working for the

debtor and acting in concert with Allied, had converted assets,

interfered    with   contractual      relationships,     breached        fiduciary

duties, and conspired to commit these acts.1            Although those claims

were lodged against both Allied and Zoll, for ease in exposition we

refer to them as claims against Allied.

            A series of procedural maneuvers followed, but none of

them is relevant here.        What matters is that the trustee, unaware

of the pendency of the state court action, filed his final report,

and the bankruptcy court — equally unaware of the state court


     1
       City further alleged that Zoll and Allied had violated the
Racketeer Influenced and Corrupt Organizations Act (RICO), 18
U.S.C. §§ 1961-1968. This claim is not at issue here.

                                      -5-
action — closed the bankruptcy case.        It was not until some

eighteen months later that Allied brought the state court action to

the trustee's attention.     At that juncture, the trustee moved to

reopen the bankruptcy case.

           The bankruptcy court granted the motion and, over City's

strenuous objection, authorized the trustee to take over the claims

against Allied. The court reasoned that the claims were commercial

tort claims, that they belonged to the estate, and that the trustee

had exclusive standing to pursue them.     In re Am. Cartage, Inc.,

No. 03-44308, 2009 WL 4780972, at *4-6 (Bankr. D. Mass. Dec. 11,

2009). With City continuing to object, the court then approved the

trustee's proposal to settle the claims for $12,000.   Id. at *7-8.

           City took a first-tier appeal to the district court,

which affirmed the bankruptcy court's orders. See City Sanit., LLC

v. Burdick (In re Am. Cartage, Inc.), 438 B.R. 1 (D. Mass. 2010).

This timely appeal ensued.

II.   ANALYSIS

           In bankruptcy cases, Congress has fashioned a two-tiered

framework for appellate review as of right.   Under this framework,

litigants in the ordinary case must first appeal to the district

court (or, in some circuits, a bankruptcy appellate panel). See 28

U.S.C. § 158(a)-(b); Brandt v. Repco Printers & Lithographics, Inc.

(In re Healthco Int'l, Inc.), 132 F.3d 104, 107 (1st Cir. 1997).

The courts of appeals are then available as a second tier of


                                 -6-
appellate review. See 28 U.S.C. § 158(d)(1); Stornawaye Fin. Corp.

v. Hill (In re Hill), 562 F.3d 29, 32 (1st Cir. 2009).             Despite

this   sequencing,    we   cede   no    special   deference   to    the

determinations made by the first-tier tribunal (whether a district

court or a bankruptcy appellate panel), but assess the bankruptcy

court's decision directly.    Gannett v. Carp (In re Carp), 340 F.3d

15, 21 (1st Cir. 2003).      In that process, we review findings of

fact for clear error and conclusions of law de novo.          Groman v.

Watman (In re Watman), 301 F.3d 3, 7 (1st Cir. 2002).

            In this second-tier appeal, City asseverates that it had

standing to prosecute the claims against Allied and that, in all

events, the settlement negotiated by the trustee should have been

rejected.    We address these contentions separately.

                      A.   The Disputed Claims.

            City argues that the claims against Allied are proceeds

of the collateral that it acquired from FFC (through Todesca) and

that, therefore, it has standing to pursue those claims.           Allied

asserts that the disputed claims are commercial tort claims, not

proceeds, and as such, are not covered by FFC's security interest.

We look to state law to resolve this issue.

            "Creditors' entitlements in bankruptcy arise in the first

instance from the underlying substantive law creating the debtor's

obligation."    Shamus Holdings, LLC v. LBM Fin., LLC (In re Shamus

Holdings, LLC), 642 F.3d 263, 267 (1st Cir. 2011) (quoting Raleigh


                                  -7-
v. Ill. Dep't of Rev., 530 U.S. 15, 20 (2000)).                            Here, the

underlying      substantive        law   is      the   law   of     Massachusetts,     a

jurisdiction in which secured transactions are governed by a state-

specific iteration of Article 9 of the Uniform Commercial Code

(UCC).    See Mass. Gen. Laws ch. 106, §§ 9-101 to 9-709.                        It is

uncontradicted that, in this case, the debtor gave FFC a security

interest in many of its assets. The question, then, is whether the

claims asserted against Allied were caught up within the sweep of

this security interest.

            By its terms, Article 9 applies to transactions that

"create[] a security interest in personal property or fixtures by

contract"      and   to    sales    of   "accounts,       chattel     paper,    payment

intangibles, or promissory notes."                 Id. § 9-109(a)(1), (3).            But

this article does not apply to "an assignment of a claim arising in

tort, other than a commercial tort claim."                   Id. § 9-109(d)(12).        A

commercial tort claim is defined in relevant part as a "claim

arising   in    tort      with   respect      to   which[]    the    claimant    is   an

organization."         Id. § 9-102(a)(13).             Since all of the potential

claimants — the debtor, FFC, Todesca, and City — are organizations,

we will not dwell upon that aspect of the definition.                     See 4 James

J. White & Robert S. Summers, Uniform Commercial Code § 30-10, at

81 (6th ed. 2010).

            Here, the asserted claims are claims for conversion,

interference with contractual relations, breach of fiduciary duty,



                                           -8-
and civil conspiracy.         Each of them sounds in tort.            See, e.g.,

City Sanit. LLC v. Beck, 947 N.E.2d 1152 (Mass. App. Ct. 2011)

(table) (conversion); Cachopa v. Town of Stoughton, 893 N.E.2d 407,

409 n.3 (Mass. App. Ct. 2008) (interference with contractual

relations); Doe v. Harbor Sch., Inc., 843 N.E.2d 1058, 1065-66

(Mass. 2006) (breach of fiduciary duty); Kyte v. Philip Morris

Inc., 556 N.E.2d 1025, 1027 (Mass. 1990) (civil conspiracy); see

also Restatement (Second) of Torts §§ 222A, 766, 874, 876.                   Thus,

the claims fall squarely within the UCC's definition of commercial

tort claims.

              Under Massachusetts law, commercial tort claims must be

described with specificity in a security agreement in order to be

considered part of that agreement.           Mass. Gen. Laws ch. 106, § 9-

108(e)(1). This requirement places commercial tort claims in stark

contrast to other kinds of collateral, which may be defined broadly

by   type    as   long   as   the   description,    even   if   not       specific,

"reasonably identifies what is described."                 Id. § 9-108(a).

Furthermore,      an   after-acquired    property    clause     in    a   security

agreement cannot create a security interest in a commercial tort

claim.      Id. § 9-204(b)(2).      The claim must already exist when the

parties enter into the security agreement.             See id. cmt. 4; see

also id. § 9-108 cmt. 5.

              The security agreement here did not specifically mention

any claims against Allied.          Moreover, no such claims existed when



                                       -9-
the security agreement was signed (indeed, Allied had not then

appeared on the scene).             It is, therefore, plain that these

commercial tort claims were not transferred by foreclosing pursuant

to   the   security    agreement.      Rather, those    claims   remain    the

property of the estate, and the trustee is the proper party to

prosecute them.       See 11 U.S.C. § 323(b); see, e.g., In re Kane, 628

F.3d 631, 637 (3d Cir. 2010); Moses v. Howard Univ. Hosp., 606 F.3d

789, 795 (D.C. Cir. 2010).

            City tries to avoid the force of this reasoning by

characterizing the claims as proceeds of collateral. This argument

presents an issue of first impression in this circuit.                     The

question is whether the right to pursue a commercial tort claim can

be passed to a secured creditor as proceeds of original collateral.

We conclude that it cannot.

            Proceeds are defined in relevant part as "rights arising

out of collateral [and,] to the extent of the value of collateral,

claims arising out of the loss, nonconformity, or interference with

the use of, defects or infringement of rights in, or damage to, the

collateral." Mass. Gen. Laws ch. 106, § 9-102(a)(64)(C)-(D). City

argues that FFC's security interest (to which it has succeeded)

confers    upon   it   the   right   to   prosecute   claims   arising    from

interference with the collateral. But we interpret the UCC and the

case law to mean that the term "proceeds" refers to the secured




                                      -10-
creditor's right to value derived from the collateral, not to the

mere act of attempting to recover that value.

              Of course, the UCC states that "[a] security interest in

a tort claim . . . may exist under this Article if the claim is

proceeds of other collateral."           U.C.C. § 9-102 cmt. 5(g). But this

comment must be read in light of the UCC's statement that it is a

right to payment from the resolution of a tort claim, and not the

claim   itself,       that    may    constitute    proceeds    of    collateral.

"[Article 9] . . . applies to assignments of 'commercial tort

claims' . . . as well as to security interests in tort claims that

constitute proceeds of other collateral (e.g., a right to payment

for negligent destruction of the debtor's inventory)." Id. § 9-109

cmt. 15 (emphasis added).             Viewed as a whole, Article 9 teaches

that when a party has an interest in a commercial tort claim as

proceeds, what the secured party has is a right to the recovery,

not a right to the claim itself.            An action for conversion is not

proceeds; only the end product of that action — the settlement

amount or award — constitutes proceeds.

              The case law cited by City is unpersuasive.             Those cases

stand only      for    the    proposition   that     money    received   from the

settlement of, or judgment on, a tort claim can be proceeds of the

collateral harmed.           Thus, "[t]he usual proceeds of collateral are

the   money    obtained       from    selling   it   [or]    money   obtained   in

compensation for a diminution in [its] value."                Helms v. Certified



                                        -11-
Packaging Corp., 551 F.3d 675, 678 (7th Cir. 2008); see McGonigle

v. Combs, 968 F.2d 810, 828 (9th Cir. 1992) (stating that proceeds

arise out of "[t]he classic situation . . . of a tort recovery

obtained by a debtor for damage to secured property"). These cases

speak of claims that already have been brought to fruition and

resulted in recoveries.        Contrary to City's importunings, these

cases do not support the notion that a secured party acquires the

right to prosecute the debtor's commercial tort claims as proceeds,

as opposed to acquiring the right to a payment compensating for

harm to its collateral.

            To    cinch   matters,    treating      commercial     tort   claims

themselves   as    proceeds   would    blur   any     meaningful   distinction

between the two categories.           We do not believe that either the

Massachusetts legislature or the drafters of the UCC had such an

obscuration in mind. Cf. Local 589, Amalg'd Transit Union v. MBTA,

491 N.E.2d 1053, 1057 (Mass. 1986) (explaining that the adoption of

such   a   definition     would   "creat[e]      an   exception     capable   of

swallowing the rule" (citation omitted)).             Unliquidated claims of

an organization alleging tortiously inflicted harm are properly

classified as commercial tort claims.         The claims asserted against

Allied are commercial tort claims, not proceeds.

            City has a laundry list of related arguments.                 We can

dispose summarily of the first item on this list: City's suggestion

that the trustee's agreement to provide FFC with relief from the



                                      -12-
automatic stay and the bankruptcy court's ensuing order gave FFC a

security interest in the claims against Allied.          The replacement

liens never specifically described any claims against Allied, so

they could not have transferred an interest in such claims to FFC.

See Mass. Gen. Laws ch. 106 § 9-108(e)(1).

            City's allusion to the form of order prepared by FFC in

connection with the lifting of the automatic stay gains it no

traction.     This order, entered by the bankruptcy court, listed

among other items of collateral "trade names, service names,

service marks, telephone numbers, choses in action [and] vehicles."

City posits that the inclusion of "choses in action" somehow

transferred     any    claims   that   the    debtor    might     have   had

notwithstanding the fact that the debtor never granted a security

interest in "choses in action" to FFC.        This premise is hopeless.

Massachusetts    law    holds   that   "in   the   absence   of   statutory

restrictions, the rights of the parties to secured transactions are

controlled by the agreement between them," Mechs. Nat'l Bank of

Worcester v. Killeen, 384 N.E.2d 1231, 1236 (Mass. 1979), and as

the security agreement here did not include an interest in "choses

in action," we will not expand the parties' rights under that

agreement to include such an interest.

            City's next argument requires more discussion.          It says

that Allied harmed its collateral as opposed to harming the assets




                                   -13-
of the bankruptcy estate, so that it has standing to pursue the

disputed claims.    This argument puts the cart before the horse.

          It is common ground that when a cause of action belongs

to the bankruptcy estate, the trustee has the exclusive right to

assert it.   Honigman v. Comerica Bank (In re Van Dresser Corp.),

128 F.3d 945, 947 (6th Cir. 1997); Koch Ref. v. Farmers Union Cent.

Exch., Inc., 831 F.2d 1339, 1342 (7th Cir. 1987).   Conversely, the

trustee lacks standing to pursue claims that belong personally to

the creditors.     Stevenson v. J.C. Bradford & Co. (In re Cannon),

277 F.3d 838, 853 (6th Cir. 2002); Koch Ref., 831 F.2d at 1348-49.

A court tasked with determining who can pursue a particular claim

must look to the kind of harm alleged.

          If the claim is a general one, it is property of the

estate.   See Koch Ref., 831 F.2d at 1348-49 (claim is general if

"the liability is to all creditors of the corporation").         Put

another way, when the alleged injury to a creditor is indirect or

derives solely from an injury to the debtor, the claim is general.

Schertz-Cibolo-Univl. City, Indep. Sch. Dist. v. Wright (In re

Educators Grp. Health Trust), 25 F.3d 1281, 1284 (5th Cir. 1994).

Claims are deemed personal, rather than general, when a creditor

"himself is harmed and no other claimant or creditor has an

interest in the cause."   Koch Ref., 831 F.2d at 1348.   A trustee in

bankruptcy has no standing to prosecute such a personal claim.      In

re Cannon, 277 F.3d at 853-54.



                                 -14-
             In   this    instance,    the        claimed   wrongdoing    supposedly

occurred while Zoll was still in the debtor's employ.                    His acts (if

they occurred at all) took place well before FFC gained possession

of its collateral. Any wrong committed would, therefore, have been

directly     adverse      to   the   debtor's        interests   and     would   have

diminished its estate generally.             See Highland Capital Mgmt., L.P.

v. Welsh, Carson, Anderson & Stowe, VI, L.P. (In re Bridge Info.

Sys., Inc.), 344 B.R. 587, 594-95 (E.D. Mo. 2006); In re Eagle

Enters., Inc., 265 B.R. 671, 678 (E.D. Pa. 2001).                      Consequently,

the harm was to the debtor, and these claims must be considered

part of the debtor's estate.

             This point is reinforced by an examination of the state

court complaint, which only describes harm inflicted upon the

debtor, its customers, and its assets.                      As to City, the harm

alleged is derivative and indirect.

             The short of it is that FFC (in whose shoes City stands)

is no different from any other creditor of the debtor with respect

to   the    asserted     claims.      If    Allied,     with   Zoll's connivance,

misappropriated the debtor's assets, the trustee is the proper

party to assert those claims.              See Koch Ref., 831 F.2d at 1342-43.

             In an effort to change the trajectory of the debate, City

falls      back   on   the     venerable      tenet     that   any   property    not

administered when a bankruptcy case is closed is deemed abandoned.

See 11 U.S.C. § 554(c).            Based on that tenet, it posits that it



                                           -15-
owns the claims against Allied because the trustee abandoned them.

The district court did not reach the merits of this argument, nor

do we.

           Bankruptcy Rule 8006 requires that a first-tier appeal

include "a statement of the issues to be presented."                  Several

courts have held that a party's failure to include a particular

issue in such a statement means — at least in the absence of

exceptional circumstances — that the issue is waived.           See, e.g.,

Zimmermann v. Jenkins (In re GGM, P.C.), 165 F.3d 1026, 1032 (5th

Cir. 1999); Snap-On Tools, Inc. v. Freeman (In re Freeman), 956

F.2d 252, 255 (11th Cir. 1992).        We have heretofore avoided ruling

on this point.     See Yacovi v. Rubin and Rudman, L.L.P. (In re

Yacovi), 411 F. App'x 342, 348 (1st Cir. 2011).         This case presents

the question head-on.

           While we are aware of the existence of some authority to

the contrary, see, e.g., Office of the U.S. Tr. v. Hayes (In re

Bishop, Baldwin, Rewald, Dillingham & Wong, Inc.), 104 F.3d 1147,

1148 (9th Cir. 1997) (per curiam), we believe that the rationale

behind the waiver rule is sound.           Cf. Sunview Condo. Ass'n v.

Flexel   Int'l,   Ltd.,   116   F.3d    962,   964-65   (1st   Cir.    1997)

(concluding that plaintiff who did not seek district court review

of magistrate judge's ruling waived the right to challenge that

ruling on appeal).   Rules are essential for the orderly processing

of litigation, and a party's disregard of a rule, without good



                                  -16-
cause, ought not to be condoned.          We therefore hold that at least

where, as here, there are no exceptional circumstances, failure to

comply with Rule 8006 waives the omitted issue on appeal.

            This does not mean, of course, that the list of issues

must be precise to the point of pedantry.               An issue that is not

specifically enumerated may be deemed preserved if the substance of

the issue reasonably can be inferred from an issue or issues that

are listed.    See In re Freeman, 956 F.2d at 255.            Here, however,

the abandonment issue is both legally and factually distinct from

the issues that City articulated in its Rule 8006 statement.

            We need not tarry. The district court carefully examined

City's Rule 8006 statement and cogently explained why the omitted

argument    could   not   be   inferred    from   any   argument   identified

therein.    See City Sanit., 438 B.R. at 8-10.             It would serve no

useful purpose to rehearse that exercise here.            The bottom line is

that, in the circumstances of this case, City's noncompliance with

Rule 8006 resulted in a waiver of its afterthought abandonment

argument.

            That ends this aspect of the appeal.             For the reasons

stated, we conclude that the claims against Allied were commercial

tort claims; that those claims remained property of the debtor's

estate; and that the trustee had exclusive standing to assert them.




                                    -17-
                   B.    Approval of the Settlement.

            Our conclusion that the trustee had exclusive standing to

maintain the disputed claims brings us to City's back-up argument:

that the bankruptcy court abused its discretion when it approved

the trustee's proposed settlement of those claims.2

            Bankruptcy court approval of a negotiated settlement

engenders    deferential      review.    The   authority   to   approve   or

disapprove a settlement lies within the sound discretion of the

bankruptcy   court,     and   we will   overturn   the exercise    of   that

discretion only upon a showing of abuse. See, e.g., Ars Brook, LLC

v. Jalbert (In re Servisense.com, Inc.), 382 F.3d 68, 71 (1st Cir.

2004).   In such situations, appellate review operates with the

background understanding that settlements are looked upon with

favor in bankruptcy proceedings.           Protective Comm. for Indep.

Stockholders of TMT Trailer Ferry, Inc. v. Anderson, 390 U.S. 414,

424 (1968); Hicks, Muse & Co. v. Brandt (In re Healthco Int'l,

Inc.), 136 F.3d 45, 50 n.5 (1st Cir. 1998).         The task of both the

bankruptcy court and any reviewing court is "to canvass the issues

and see whether the settlement falls below the lowest point in the

range of reasonableness." Cosoff v. Rodman (In re W.T. Grant Co.),




     2
       We have some doubt as to whether City has standing to raise
this ground of appeal. See Spenlinhauer v. O'Donnell, 261 F.3d
113, 117-18 (1st Cir. 2001) (noting limitations on appellate
standing in bankruptcy). Because the merits of City's plaint are
easily resolved, we assume arguendo that City has standing.

                                    -18-
699 F.2d 599, 608 (2d Cir. 1983) (alterations, internal quotation

marks, and citation omitted).

          The trustee plays a special role in the approval process

because he is the person "entrusted to marshal an estate's assets

and liabilities, and proceed in settling its accounts on whatever

grounds he, in his informed discretion, believes will net the

maximum return for the creditors (on whose behalf he toils)."

LeBlanc v. Salem (In re Mailman Steam Carpet Cleaning Corp.), 212

F.3d 632, 635 (1st Cir. 2000).      If a trustee chooses to accept a

less munificent sum for a good reason (say, to avoid potentially

costly litigation), his judgment is entitled to some deference.

See Kowal v. Malkemus (In re Thompson), 965 F.2d 1136, 1145 (1st

Cir. 1992).    Nevertheless, a bankruptcy court cannot blindly take

the trustee's word that a settlement is fair and reasonable.       It

"must apprise [it]self of all facts necessary to evaluate the

settlement and make an 'informed and independent judgment.'"

LaSalle Nat'l Bank v. Holland (In re Am. Reserve Corp.), 841 F.2d

159, 162 (7th Cir. 1987) (quoting TMT Trailer Ferry, 390 U.S. at

424); see In re Mailman Steam Carpet Cleaning, 212 F.3d at 635.

          In    considering   the   reasonableness   of   a   proposed

settlement, a bankruptcy court's decisional calculus typically is

informed by the Jeffrey factors:

          (i) the probability of success in the
          litigation   being   compromised;   (ii)   the
          difficulties, if any, to be encountered in the
          matter of collection; (iii) the complexity of


                                 -19-
          the litigation involved, and the expense,
          inconvenience and delay attending it; and,
          (iv) the paramount interest of the creditors
          and a proper deference to their reasonable
          views in the premise.

Jeffrey v. Desmond, 70 F.3d 183, 185 (1st Cir. 1995); see TMT

Trailer Ferry, 390 U.S. at 424 (enumerating a similar mix of

factors as "relevant to a full and fair assessment of the wisdom of

the proposed compromise").   In the case at hand, City strives to

convince us that all the Jeffrey factors favor it and that the

bankruptcy court miscalibrated the scales.   We are not persuaded.

          City insists that collecting a judgment from Allied, a

publicly traded company, would be child's play.      Even so, this

consideration is outweighed by the three remaining Jeffrey factors.

          We start with the probability of success, which the

bankruptcy court concluded was low.    In re Am. Cartage, 2009 WL

4780972, at *7.   This conclusion is supported by the fact that the

trustee (a person intimately familiar with the debtor's internal

operations) thought that the claims were groundless.     See In re

Thompson, 965 F.2d at 1145 (crediting trustee's representation

regarding merits of litigation).   It is also supported by the fact

that the trustee hired Allied and introduced Allied to the debtor's

customers in order to curtail serial breaches of the debtor's

existing contracts.    The debtor's failure to obtain liability

insurance (thus jeopardizing the bankruptcy estate) lends credence

to the notion that the debtor was incapable of servicing its



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customers by itself.        Allied's non-culpable involvement with the

debtor's customers was, thus, fully explained, and the bankruptcy

court appears carefully to have weighed this explanation.

            The third Jeffrey factor also cuts in favor of approval.

The convoluted nature of the state court action, which featured

multiple claims involving third parties and a tangled procedural

posture, sounds an aposematic note.         If the trustee were to pursue

the claims, he would be obliged to expend substantial resources on

discovery, motion practice, and trial, without a high likelihood of

success.    Because the estate had been closed, there were no funds

available    to    underwrite     such   costs.      In    these   straitened

circumstances,      we   cannot   second-guess     the    bankruptcy   court's

inference that continued litigation would bring with it too high a

level of expense and delay.        See In re Servisense.com, 382 F.3d at

75-76; In re Dennett, 449 B.R. 139, 145-46 (Bankr. D. Utah 2011).

            Finally, the bankruptcy court appropriately took into

account the paramount interest of the creditors.            Settling quickly

for   $12,000     allowed   the   trustee   to    distribute   something   to

creditors.      In bankruptcy, as in life, half a loaf is sometimes

better than none.

            City takes umbrage with the fact that it was never

consulted about the probability of success in the state court

action.     But City points to no requirement that a trustee must

consult a potential creditor before settling a general claim, and



                                     -21-
we do not think that any such requirement existed here.                     Cf.

Whispering    Pines   Estates,   Inc.   v.   Flash   Island,   Inc.   (In    re

Whispering Pines Estates, Inc.), 370 B.R. 452, 461 (B.A.P. 1st Cir.

2007) (finding no reason to defer to party proposing settlement

simply because it stood to benefit from proposal).

             City also suggests that the trustee neglected to apprise

the bankruptcy court of all the material facts.             But despite the

sound and fury in which this suggestion is couched, City never

identifies any material information that the trustee withheld from

the bankruptcy court.

             In the last analysis, "many, if not most, claims settled

in bankruptcy proceedings are not amenable either to ready or exact

valuation."     Hicks, 136 F.3d at 51.       In this case, the bankruptcy

court made a thorough examination into the bona fides of the

proposed settlement and the attendant risk-reward ratio.                     It

sensibly concluded that the recommended settlement fell within the

range   of   reasonableness.      In    light   of   the   totality   of    the

circumstances, we conclude, without serious question, that the

approval of the settlement was within the bankruptcy court's wide

discretion.     See, e.g., Jeremiah v. Richardson, 148 F.3d 17, 22

(1st Cir. 1998) (affirming settlement when lower court "patiently

informed itself of the relevant facts, and carefully exercised

independent judgment").




                                   -22-
III.   CONCLUSION

            We need go no further. For the reasons elucidated above,

we reject City's appeal.



Affirmed.




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