LexisNexis ( March 16, 2023, 3:21 PM EDT) -- Recently, a bankruptcy court ruled that a secured creditor with a perfected security interest in the debtor’s milk quota – a license to produce milk for the fresh milk market – but no security interest in the debtor’s cows, did not have a security interest in the milk the cows produced. In re Las Martas, Inc., 2023 Bankr. LEXIS 419 (Bankr. D.P.R. Feb. 15, 2023). The ruling is in line with a thoughtful opinion by then-Judge Bruce Markell holding that revenues generated from the operation of a monorail are not proceeds of the debtor’s franchise agreement permitting it to operate the monorail. See In re Las Vegas Monorail Co., 429 B.R. 317 (Bankr. D. Nev. 2010). The decision in Las Martas is also a reminder that, while the concept of proceeds is broad, it is not limitless. What follows is a primer on what the term “proceeds” covers, what it does not, and when a security interest in proceeds will be perfected....