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Preferential Transfers

Tonkon Torp LLP

Understanding Rollover Equity

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For the right transaction, a rollover of equity can add value for the buyer and the seller. Rollover equity is ownership in the buyer or its affiliates that is issued to a seller as payment for all or a portion of the...more

Proskauer Rose LLP

Relief for Non-U.S. Investment Advisers: SEC Clarifies the Extraterritorial Limits of the New Private Fund Adviser Rules

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On August 23, 2023, the U.S. Securities and Exchange Commission (“SEC”) adopted its highly anticipated new rules and amendments to existing rules under the Investment Advisers Act of 1940 (“Advisers Act”) impacting private...more

Jones Day

Delaware Bankruptcy Court Rules that Due Diligence Is Element of Preference Claim Rather Than Basis for Affirmative Defense

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A bankruptcy trustee's ability to avoid and recover pre-bankruptcy preferential transfers is essential to preserving or augmenting the estate for the benefit of all stakeholders. In 2019, however, the Bankruptcy Code was...more

Freeman Law

Faulkner v. Broadway Festivals, Inc., Adv. Proc. 20-05031 (Bankr. N.D. – Tex., January 11, 2022)

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Faulkner v. Broadway Festivals, Inc. The recent bankruptcy case for Northern District of Texas, Faulkner v. Broadway Festivals, Inc., Adv. Proc. 20-05031 (Bankr. N.D. – Tex., January 11, 2022), addresses preferential...more

Patterson Belknap Webb & Tyler LLP

One Bankruptcy Court’s Analysis of a Motion to Dismiss Avoidance Claims: The Analytical Framework

A federal judge recently allowed a trustee’s preferential transfer claim against a law firm to proceed but dismissed a constructive fraudulent transfer claim. The decision highlights the pleading standards and analytical...more

Patterson Belknap Webb & Tyler LLP

Critical Vendors Aren’t Immune from Lawsuits to Recover Preferential Transfers

Some courts permit debtors to designate vendors crucial to their business as “critical vendors.” These vendors supply debtors with necessary goods or services. Debtors are permitted to pay them amounts owing when a...more

Maynard Nexsen

Summer 2021: Time to Act to Protect Distressed Accounts Receivable from Bankruptcy Preference Liability

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Bankruptcy preference claims are viewed by businesses as an unfair legal tool that debtors and trustees use to take money back, even though the pre-bankruptcy payments from the debtor were for legitimate business debts. By...more

Rosenberg Martin Greenberg LLP

The Trustee Is Suing Me For A Transfer I Received How Many Years Ago?

Any creditor that has experienced more than a few customers or borrowers filing for bankruptcy is aware that there is a risk of being sued by a trustee to avoid transfers that the creditor received prior to the bankruptcy...more

Pillsbury Winthrop Shaw Pittman LLP

The Letter of Credit Conundrum: When a Debtor’s Default May Be Preferable to Its Late Payment

“Can an unsecured creditor be better off when the debtor defaults rather than paying off the debt? Yes: Law can be stranger than fiction in the Preference Zone.”—Ninth Circuit Untimely payment by tenants and other obligors...more

Lowenstein Sandler LLP

Preference Defense Primer Update: Diligence Can Pay Off!

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Nothing is more frustrating to a trade creditor saddled with a large unpaid balance owed by a debtor in bankruptcy than being subject to the risk of having to remit back to the debtor’s estate “preference” payments received...more

Harris Beach PLLC

Revisions to Bankruptcy Code Spell Good News for Creditors

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It is bad enough when a customer or borrower files for bankruptcy and you have to write off the debt, but things can get worse when you are then faced with a lawsuit to recover payments made within the 90 days prior to the...more

Partridge Snow & Hahn LLP

Alex Mattera: Bankruptcy Law

We hope you enjoy this edition of Three Things, an effort from Partridge Snow & Hahn that identifies three timely and noteworthy items our attorneys think you could find helpful and interesting....more

Adler Pollock & Sheehan P.C.

Insight on Estate Planning - October/November 2019: Estate planning with a foreign twist

If a married couple includes a non-U.S. citizen spouse, there are special estate planning rules to take into account, such as a significantly smaller estate tax exemption. This article explains the differences in estate tax...more

Jones Day

Second Circuit Rules that Bankruptcy Code’s Fraudulent Transfer Recovery Provisions Can Reach Foreign Transferees

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The ability of a bankruptcy trustee to avoid fraudulent or preferential transfers is a fundamental part of U.S. bankruptcy law. However, when an otherwise avoidable transfer by a U.S. entity takes place outside the U.S. to a...more

Latham & Watkins LLP

UK Court of Appeal: Creditors Can Seek to Reverse Lawful Dividend Payments

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Ruling provides helpful reminder to directors, companies, and creditors that Section 423 of the Insolvency Act 1986 applies even outside of insolvency. Background - The UK Court of Appeal has upheld a decision that a...more

Jones Day

Eleventh Circuit Expands "Subsequent New Value" Preference Defense to Cases Involving Paid-For New Value

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In Kaye v. Blue Bell Creameries, Inc. (In re BFW Liquidation, LLC), 899 F.3d 1178 (11th Cir. 2018), the U.S. Court of Appeals for the Eleventh Circuit broadened the scope of section 547(c)(4) of the Bankruptcy Code’s...more

A&O Shearman

A Matter of Preference: Court of Appeals for the Eleventh Circuit Holds That the Bankruptcy Code Does Not Require New Value to...

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On August 14, 2018, the United States Court of Appeals for the Eleventh Circuit issued a decision holding that section 547(c)(4) of the Bankruptcy Code, which provides a defense to the avoidance of preferential transfers to...more

Nutter McClennen & Fish LLP

Request for Injunctive Relief Denied as Premature ‘Creditor’s Bill’

In Anesthesia Associates, Judge Salinger rejected the plaintiff’s motion for a preliminary injunction because, in essence, the motion constituted a premature creditor’s bill....more

Holland & Knight LLP

Eleventh Circuit Issues Opinion on New Value Defense to a Preference Claim

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• In its recent decision in William S. Kaye, Trustee of the BFW Liquidating Trust v. Blue Bell Creameries, Inc. (In re BFW Liquidation, LLC), the U.S. Court of Appeals for the Eleventh Circuit held that liability for a...more

Burr & Forman

Blue Bell Creameries: Dishing Out a New Value Treat for Preference Defendants

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Trying to explain the primary purpose of Section 547 of the Bankruptcy Code to a client that just received a demand letter or complaint to avoid and recover preferential transfers can be a tough sell. Although the Section’s...more

Jones Day

Debate Intensifies as to Whether the Bankruptcy Code’s Avoidance Provisions Apply Extraterritorially

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The ability of a trustee or chapter 11 debtor-in-possession to avoid fraudulent or preferential transfers is a fundamental part of U.S. bankruptcy law. However, when a transfer by a U.S. entity takes place outside the U.S. to...more

Jones Day

Yet Another Ruling Deepens the Divide on Whether the Bankruptcy Code’s Avoidance Provisions Apply Extraterritorially

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The ability to avoid fraudulent or preferential transfers is a fundamental part of U.S. bankruptcy law. However, when a transfer by a U.S. entity takes place outside the U.S. to a non-U.S. transferee—as is increasingly common...more

Jones Day

Ninth Circuit Rules That Hypothetical Preference Actions May Be Considered in Applying the Greater Amount Test

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In Schoenmann v. Bank of the West (In re Tenderloin Health), 849 F.3d 1231 (9th Cir. 2017), a divided panel of the U.S. Court of Appeals for the Ninth Circuit recently addressed as a matter of apparent first impression...more

Jones Day

In Brief: Court Rules Against Lyondell Litigation Trustee on LBO Fraudulent Conveyance Claims

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In Weisfelner v. Blavatnik (In re Lyondell Chemical Company), 2017 BL 131876 (Bankr. S.D.N.Y. Apr. 21, 2017), the bankruptcy court presiding over the chapter 11 case of Lyondell Chemical Company ("Lyondell") handed down a...more

Jones Day

Kiwi Defense Doesn't Get Off the Ground in Preference Litigation Involving Related, but Severable, Contracts

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Among the required elements of a claim to avoid a preferential transfer under section 547(b) of the Bankruptcy Code is that, if the creditor-transferee were permitted to retain a pre-bankruptcy payment, it would end up being...more

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