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to manage Drexel’s assets. During April 1990, a committee of
Drexel’s creditors began an examination of Drexel with a view to
establishing bases for possible asset and claim recoveries.
The bankruptcy court set a deadline of November 15, 1990,
for filing proofs of claim against Drexel, but allowed the IRS
until February 13, 1991, to file its proof of claim on account of
all Federal income and other taxes allegedly owed by Drexel and
its subsidiaries. During 1991, a settlement agreement was
reached between Drexel, its subsidiaries, and the IRS with
respect to the IRS' Federal tax claims. Also during 1991, Drexel
reached a settlement with respect to the securities litigation
claims made against it.
Petitioner filed a timely proof of claim against Drexel’s
bankruptcy estate. Petitioner’s claim was based on, and was
equal to, the full face amount of the note. Petitioner and other
former Drexel employees who had received notes in redemption of
Drexel shares were represented in the bankruptcy proceeding by a
committee known as the Equity Committee. During 1990, petitioner
was informed by the Equity Committee that Drexel might have
committed technical violations of the Employee Retirement Income
Security Act (ERISA) with respect to the shares and the note. A
claim pursuant to ERISA was made against Drexel’s bankruptcy
estate in connection with the subordinated notes held by
petitioner and approximately 1,000 others, and, after
negotiations, the claims filed by petitioner and other former
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