In Witt v. United Cos. Lending Corp. (“In re Witt”), 113 F.3d 508 (4th Cir. 1997), the Fourth Circuit held that Chapter 13 debtors are not permitted to bifurcate undersecured home mortgage loans into separate secured and unsecured claims. In re Witt, 113 F.3d at 509. Recently, the Court overruled this twenty-two-year-old decision in an en banc opinion, Hurlburt v. Black, No. 17-2449, 2019 WL 2237966 (4th Cir. 2019).

Fraudulent conveyance litigation arising from failed leveraged buyout transactions is frequently pursued in bankruptcy proceedings as the sole source of recovery for creditors. Targets of these actions typically include those parties who received the proceeds generated by the LBO, including the debtor’s former shareholders.