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'It Sunk'

Bankruptcy trustee sues investors, Cedar Funding creditors cry foul.

Frustrated Cedar Funding investors lashed out at bankruptcy trustee staff Aug. 21 for suing creditors. Trustee Todd Neilson is suing investors on 11 different properties because David Nilsen allegedly assigned the deeds of trust within 90 days before filing bankruptcy for his real estate loan company, Cedar Funding Inc. Neilson wants to void these transfers and recover the property for the benefit of Cedar Funding's estimated 1,500 investors.

But during the creditors' meeting at the Monterey Conference Center, Marvin Spott, an investor in a Santa Cruz property, took issue with the lawsuit. "Why are you suing me over this ...

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