From May 11 to May 13, 2016, SRC Liquidation, LLC International Holdings, LLC (“Liquidating Debtor”), unleashed yet another wave of preference actions, filing approximately 257 additional complaints seeking the avoidance and recovery of allegedly preferential and fraudulent transfers under Sections 547 and 550 of the Bankruptcy Code. The Liquidating Debtor also seeks to disallow claims of such preference defendants under Sections 502(d) and (j) of the Bankruptcy Code.

In a 9-page opinion issued in the Syntax-Brillian case on May 11, 2016, Chief Judge Brendan L. Shannon lays out three principles of law that all litigants should know (if they don’t already). A copy of the Opinion is available on the Court’s website: Here. The Opinion was issued as a ruling on the motion of Alan Levine for relief from the order accepting the first-day-declaration of Gregory F. Rayburn.

On May 5, 2016, SRC Liquidation, LLC International Holdings, LLC (“Liquidating Debtor”), filed approximately 137 complaints seeking the avoidance and recovery of allegedly preferential and fraudulent transfers under Sections 547 and 550 of the Bankruptcy Code. The Liquidating Debtor also seeks to disallow claims of such preference defendants under Sections 502(d) and (j) of the Bankruptcy Code.

A recent unpublished decision, Strunck v. Figueroa, serves as a not-so-gentle reminder that sometimes an enforcement application can be “too little, too late,” and that it is imperative to be proactive to protect your rights under a divorce decree or agreement, especially when your adversary acts in bad faith. In Strunck, a 2011 divorce decree awarded the plaintiff $23,369, which was to be transferred from the defendant’s retirement account. Before the plaintiff could act to collect the $23,369, however, the defendant withdrew the money from the retirement account.

Because no recent opinions have been published by the Delaware Bankruptcy Court, I wanted to touch on a subject that is vital in nearly every preference or fraudulent transfer case: The Statute of Limitations For A Preference Claim

A. Statute of Limitations

On May 1, 2016, BIND Therapeutics, Inc., and affiliated companies (“Debtors” or “BIND”) voluntarily filed for bankruptcy protection under Chapter 11 of the Bankruptcy Code.

The filing comes days after the Cambridge, Mass., company received a notice of default from lender Hercules Technology III LP, which demanded immediate payment of the $14.5 million the lender says it is owed under the loan. The Company is backed by Koch Industry Inc.’s David Koch.

– But they weren’t as oppressive as my subject line may imply.

In a 13 page decision, released April 22, 2016, Judge Gross of the Delaware Bankruptcy Court granted a motion to dismiss an adversary proceeding and sanctioned the Plaintiff – disallowing any further litigation against the defendants in the Bankruptcy Court. Judge Gross’ opinion is available here (the “Opinion”).

Recently in the Abengoa SA bankruptcy proceeding (click here to review prior post), the United States Bankruptcy Court for the District of Delaware entered an order permitting Debtors to reject certain nonresidential real property leases (the “Rejection Order”).

Unlike real estate transactions where a lender can obtain title insurance, secured lenders are often relying upon the representations and warranties in their loan agreement and the borrower’s audited financial statements, if and when determining whether the collateral securing their loans is owned by the borrower or another pledgor.  After default, a lender may find itself in a precarious position whereby it is unable to foreclose on the collateral because it is not owned by its borrower and it does not have a pledge from the person that actually does own the property.  According

Since the financial crisis, sales under Section 363 of the Bankruptcy Code have provided an increasingly popular way for secured creditors of distressed businesses to recover their loans.  However, despite the advantages of Section 363 sales, the significant expense and time required to conduct a Bankruptcy sale has caused secured creditors to pursue less comprehensive solutions.  One alternative for recouping value from a troubled loan is an Article 9 foreclosure sale under the Uniform Commercial Code (UCC).