In a recently decided case, Clanton, et. al. v. Inter.Net Global, L.L.C., the Court of Appeals for the 11th Circuit held that a successor company was not liable for debts of the parent which were not specifically assumed. In 1999, PSINet bought ZebraNet, Inc., a company founded by the Appellees in Clanton. The Appellees received more than $5 million and were owed an additional $992,250, to be paid by April 2001. This additional payment was labeled the "holdback". PSINet later transferred some of the acquired assets to subsidiaries, including Appellant Inter.Net. In May 2001, PSINet filed for Chapter 11 bankruptcy. They had not paid the Appellees the holdback. The Appellees filed proofs of claim for the holdback in PSINet's bankruptcy case. They prevailed on their claims and received less than $100,000 from PSINet's Trustee as an initial payment. In the meantime, the Appellees filed suit against Inter.Net in state court in Alabama. Inter.Net removed the case to federal court in Alabama's Southern District. The court entered judgement against Inter.Net and awarded the Appellees the $992,250 holdback, plus interest, minus any amount paid pursuant to PSINet's bankruptcy. Inter.Net appealed. The Court of Appeals reversed the lower court judgement, holding that under New York (the choice-of-law in this matter), Inter.Net did not assume the holdback liability. The Court stated that there are four situations which give rise to successor liability, including where there is an express or implied agreement to assume, but none applied here. The Court found that PSINet transferred to Inter.Net customer accounts and that under the Assumption of Liabilities clause of that agreement, Inter.Net assumed responsibility for contracts and liabilities specific to those customers. The Court found that PSINet further transferred thirty-seven named assets, consisting primarily of computers and office furniture and that the liabilities assumed would be related to those assets. The Court held that the holdback liability is not allocable or attributable to any of the specific assets transferred to Inter.Net and that therefore, Inter.Net was not liable for any of the holdback. Ray