U.S. v. Rogan

Dist. Ct. erred in finding that govt.'s writ of garnishment under 28 USC section 3205 was superior to debt owed to creditors by business entity where: (1) writ was issued against defendant's membership interest in business entity; (2) assets of business entity were liquidated to satisfy writ; and (3) local state law gave claims from creditors of entity priority over claims from entity's investors. Normally local state law proscribes what U.S. can collect as creditor, and Ct. of Appeals rejected govt. contention that section 3205 displaced state law once govt. obtained writ. However, remand was required because it not was clear from record that instant creditors (as opposed to company they controlled) would be directly entitled to portion of liquidated assets of business entity.