UCC 9-338 Priority Rules Screwing Up My Lien Position After Debtor Name Change

This is exactly the kind of mess that 9-338 was supposed to clarify but it still causes headaches. The good news is you're not automatically screwed. Under 9-338(c), your security interest remains perfected for four months after the name change becomes effective, but only if the original filing would be seriously misleading under the new name. The key question is whether "Advanced Manufacturing Solutions LLC" vs "AMS Industrial Group LLC" makes your original filing seriously misleading. Most courts would probably say yes since AMS could refer to dozens of different companies. You need to file a UCC-3 amendment ASAP to cover the new name, but you should still maintain priority from your original 2019 filing date if you're within that four-month window.

You're in a tight spot but not hopeless. I had something similar happen with a debtor who went from "Regional Distribution Corp" to "RDC Logistics Inc" - completely different feel to the name even though they kept the same business. The competing lender's argument about superior priority isn't necessarily correct. Even if your original filing became seriously misleading, you maintain priority for any collateral acquired before the four-month period expires. The question is when exactly did the debtor's name change become effective? That's your starting point for the four-month countdown. File your UCC-3 amendment immediately regardless. Don't wait to figure out the priority issues - just get the amendment on file to stop the clock. Then you can sort out whether the new lender actually has superior rights to any specific pieces of equipment.

The UCC 9-338 rules are supposed to be straightforward but they're anything but when you're actually dealing with a priority dispute. Here's what I'd focus on: 1. Get the exact effective date of the name change from the Secretary of State 2. File your UCC-3 amendment immediately - don't wait 3. Document everything about the collateral and when it was acquired 4. Challenge the competing lender's interpretation of their priority rights The new lender doesn't automatically get superior priority just because they filed against the correct name. They only get priority for collateral acquired after your four-month grace period expires (if you're even in that situation). Since this is $850K in equipment, it's worth fighting over every aspect of the priority rules.

I hate to be the bearer of bad news, but you might be in worse shape than you think. If the name change happened more than four months ago and you're just finding out now, your security interest could be completely unperfected as to collateral acquired after the four-month period expired. The competing lender's position isn't necessarily wrong - if they can show that collateral was acquired or moved after your grace period expired, they could have superior rights to those specific assets. You need to do a detailed analysis of when each piece of equipment was acquired or moved to the debtor's location. This is exactly why the UCC drafters created these rules - to prevent situations where filings become stale and misleading. The system assumes secured parties will monitor their debtors and maintain current filings.

Before you panic completely, make sure you understand exactly what collateral is at stake. The priority rules under 9-338 apply to specific collateral, not your entire security interest as a blanket matter. Even if some equipment was acquired after your grace period expired, you should still have priority in anything that was covered by your original filing and was acquired before the four-month deadline. Don't let the competing lender convince you that their filing wipes out your entire position. Also, check whether the new lender's filing actually covers the same collateral. Sometimes these disputes are over different categories of assets and the overlap isn't as complete as it first appears.

I'm dealing with something similar right now - debtor changed from "Metro Construction LLC" to "Metro Builder Group LLC" and I'm trying to figure out if that's seriously misleading or not. The 9-338 standard is so subjective that it's hard to predict how a court would rule. In your case, going from "Advanced Manufacturing Solutions" to "AMS Industrial Group" seems like a pretty significant change in how the entity would be identified. I'd lean toward filing the amendment and assuming you're in the four-month window, but definitely get the timing nailed down first. The competing lender might be bluffing about their priority position. A lot of lenders throw around claims about superior rights without actually doing the detailed analysis required under 9-338.

Here's what I'd do in your shoes: 1. Pull the exact corporate records to determine when the name change was effective 2. File the UCC-3 amendment TODAY - don't wait another day 3. Get a detailed inventory of all collateral and when it was acquired 4. Challenge the competing lender's priority claims with specific analysis The four-month grace period is your lifeline here, but only if you act quickly. Even if you're past the four-month deadline for some collateral, you might still have priority for assets that were covered before the deadline expired. Don't let the other lender steamroll you with broad claims about superior priority. Make them prove their position for each specific piece of collateral.

I've been through this exact scenario twice in the last three years. The first time I panicked and almost accepted the competing lender's claims without fighting. The second time I knew to dig into the details and ended up maintaining priority for about 80% of the collateral. The key insight is that 9-338 is designed to protect secured parties who are diligent, but it doesn't automatically destroy your position just because a name change occurred. You have to analyze the specific facts and timing for your situation. Get your amendment filed immediately, then focus on the detailed priority analysis. Don't assume the worst until you've actually worked through the numbers.

The timing aspect of your situation is really critical. If the name change happened recently, you're probably still within the four-month grace period and can maintain your original priority date by filing an amendment. But if it's been longer than four months, you need to shift your strategy to focus on which specific assets were acquired when, and whether the competing lender's filing actually covers the same collateral categories. Don't get overwhelmed by the complexity - just take it step by step and make the other lender prove their claims rather than accepting them at face value.

UPDATE: I got the corporate records and the name change was effective 6 weeks ago, so I'm definitely within the four-month window. Filed the UCC-3 amendment this morning and I'm working on the detailed collateral analysis. Thanks everyone for the advice - this thread helped me understand that I'm not automatically screwed just because there's a competing lender. The 9-338 analysis is more nuanced than I initially thought. I'm also going to implement some kind of systematic monitoring going forward so I don't get caught off guard like this again. This was way too stressful for something that should have been preventable with better portfolio management.