## Facts

- In 1999, Brooks L. “Louie” Dickerson granted Cornerstone Bank a security interest in his livestock; Cornerstone filed a financing statement with the Mississippi Secretary of State naming “Louie Dickerson” as debtor.
- In 2001–2002, Dickerson, Ellen Hardy, and Bill and John David Weeks organized an enterprise called Glenbrook Cattle Company; Hardy and the Weeks contributed substantial cash, while Dickerson handled operational and financial planning.
- The parties disputed whether Glenbrook was solely Dickerson’s business (including whether he owned Glenbrook and its cattle) or whether the investors held ownership interests, a dispute tied to who owned the cattle Glenbrook marketed.
- In 2002, Dickerson opened a bank account as “Louie Dickerson, dba Glenbrook Cattle Company.”
- Peoples Bank later extended credit to Dickerson and took a security interest in his livestock.
- Bryan Brothers Cattle Company and B&S Cattle Company purchased cattle from and paid Glenbrook as the apparent seller.
- After the sale, Peoples Bank and Cornerstone claimed the cattle were Dickerson’s and that their security interests continued in the cattle despite the sale; the banks also disputed lien priority between themselves.
- The district court granted summary judgment to Bryan on the view that Glenbrook owned the cattle and therefore conveyed title free of any bank lien.

## Issues

1. Whether the cattle buyers took the cattle free of any security interest because Glenbrook, as apparent seller, owned the cattle and could convey unencumbered title.
2. If the cattle remained subject to a security interest, whether Cornerstone Bank’s or Peoples Bank’s security interest had priority.

## Decision

- The Fifth Circuit reversed the summary judgment for the buyers and remanded.
- The court held a genuine issue of material fact existed regarding ownership of Glenbrook and the cattle it sold, making summary judgment improper.
- As between the banks, the court held Cornerstone had the superior lien on Dickerson’s cattle.

## Legal Principles

- Summary judgment is improper where disputed evidence creates a material fact question as to ownership of collateral and the seller’s ability to transfer title free of secured creditors’ claims.
- Under UCC Article 9 priority rules, between competing security interests in the same collateral, the earlier perfected interest generally prevails if the collateral is within the scope of the security agreement.
- A security agreement granting a security interest in a debtor’s “livestock” may be construed to cover cattle acquired later in the debtor’s ongoing cattle operations, supporting continuing attachment and priority of an earlier-perfected lien.

## Conclusion

The Fifth Circuit concluded that unresolved factual disputes about whether Glenbrook or Dickerson owned the cattle barred summary judgment for the buyers, and it further ruled that, if the cattle were Dickerson’s, Cornerstone’s earlier security interest had priority over Peoples Bank’s later interest.


Peoples Bank v. Bryan Bros. Cattle Co., 504 F.3d 549 (5th Cir. 2007)