Debtor Granted Absolution for a 10-Day Delay in Serving a $40 Million Preference Suit
Although there wasn’t ‘good cause’ to excuse late service of a summons and complaint, the bankruptcy court salvaged a large preference by exercising discretion and granting a 10-day expansion of the 90-day deadline.
Second Circuit Updates with Bill Rochelle
Fifth Circuit Explains When There Is No Double Recovery from Avoiding a Lien
Circuit Judge Edith Jones explains that the word ‘or’ in Section 550(a) doesn’t mean ‘and.’
Court:
Bill Rochelle’s Top 10 Daily Wires
In Pari Delicto Defense Doesn’t Apply to a Trustee Exercising Avoidance Powers
Because a trustee suing to recover a fraudulent transfer is acting in the interest of creditors, not the debtor, the in pari delicto defense does not apply, says Bankruptcy Judge Scott Clarkson.
Benchnotes March 2025
Journal Issue:
Applying Pressure on the Debtor Obviates the ‘Ordinary Course’ Defense to a Preference
The ‘ordinary course’ defense only applies to credit terms with healthy customers, not to debtors in financial distress, even if pressure is ordinary in the industry.
Court:
A Transfer from the Debtor to a Constructive Trust Isn’t a Transfer of Debtor’s Property
If there’s a constructive trust on property in the debtor’s name, the debtor was only the trustee of the constructive trust and had no legal interest in the property.
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