On Bankruptcy and Mediation
Can’t make this view up! (Photo by Marilyn Swanson) By Donald L. Swanson You can’t make this stuff up. The legal issues are pedestrian. But the facts behind those issues are incredible! Litigation History Here’s the boring stuff first. On January 8, 2024, the U.S. Supreme Court denies certiorari in Mann v. LSQ Funding Group, L.C.... Continue Reading →
Avoiding obligations? (photo by Marilyn Swanson) By: Donald L Swanson “The trustee may avoid . . . any obligation . . . incurred by the debtor, that was made or incurred“ with actual fraudulent intent or as constructive fraud. --From § 548 of Bankruptcy Code (emphasis added). Similar language is contained in the Uniform Voidable Transactions... Continue Reading →
Little-known and rarely-used? (Photo by Marilyn Swanson) By: Donald L Swanson Preference avoidance provisions are a crucial part of the Bankruptcy Code—contained, primarily, in § 547 & § 550. States also have a preference avoidance statute—for insiders. It’s in the Uniform Voidable Transactions Act (“UVTA)” or in its predecessor, the Uniform Fraudulent Transfer Act (“UFTA)). The... Continue Reading →
What’s the reasonably equivalent value? (Photo by Marilyn Swanson) By: Donald L Swanson Can the foreclosure of a property tax lien on real estate be avoided as a fraudulent transfer under § 584 of the Bankruptcy Code? That’s the issue before the District Court, on a bankruptcy appeal, in Duvall v. County of Ontario, New York,... Continue Reading →
Hindering and delaying the flow of water (photo by Marilyn Swanson) By: Donald L Swanson Fraudulent conveyance law, with its “badges of fraud” approach, has been around for a very long time. We now have a new and fascinating article, by Prof. Emily Kadens, that provides new information and insights on this history. [Fn. 1] One... Continue Reading →
Safe harbor (photo by Marilyn Swanson) By: Donald L Swanson In its unanimous Merit Management Group, LP v.FTI Consuting, Inc., opinion of February 27, 2018, the U.S. Supreme Court held (in the second-to-last sentence of the opinion): “Because the parties do not contend that either Valley View or Merit is a ‘financial institution’ or other covered... Continue Reading →
A conduit (photo by Marilyn Swanson) By Donald L. Swanson Under the Bankruptcy Code, an “initial transferee” is strictly liable for a fraudulent transfer—there is no good faith, subsequent advance, or similar defense. Fortunately for some fraudulent transfer defendants, it’s possible to be the “recipient” of a transfer as a mere conduit, without becoming a “transferee”... Continue Reading →
A closed door By: Donald L Swanson “We need not resolve” Appellants’ arguments, but we find such arguments to be fraught with “lack of statutory support, ambiguities, anomalies” and to conflict with “purposes of the Code.” --Second Circuit Court of Appeals, from December 19, 2019, opinion in In re Tribune Company Fraudulent Conveyance Litigation. As a... Continue Reading →
By: Donald L Swanson Court Ruling: A transferee on inquiry notice of fraud must diligently investigate its suspicions, before a good faith defense is available, even if an investigation would have revealed nothing. This ruling is from Janey, Receiver v. Magness, Case No. 19-0452 in the Texas Supreme Court (decided December 20, 2019), which Court is... Continue Reading →
By: Donald L. Swanson “we assume without deciding, that the fraudulent conveyance claims in this case are Stern claims.” [Fn. 1] From unanimous U.S. Supreme Court decision in Executive Benefits Insurance Agency v Arkison (Decided June 6, 2014). [Fn. 2] It’s a curious thing, this failure-to-decide the constitutional status of fraudulent transfer claims in bankruptcy. Here’s... Continue Reading →
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