On September 7-8, 2016, various debtors in the ADI Liquidation, Inc. (f/k/a AWI Delaware, Inc.), et al. bankruptcy proceeding filed approximately 332 complaints seeking the avoidance and recovery of allegedly preferential and/or fraudulent transfers under Sections 544 and/or 547, 548 and 550 of the Bankruptcy Code (depending upon the nature of the underlying transactions). The Debtors also seek to disallow claims of such defendants under Sections 502(d) and (j) of the Bankruptcy Code.
Of the 332 avoidance actions, AW Liquidation, Inc. (f/k/a Associated Wholesalers, Inc.), filed approximately 294, WR Liquidation, Inc. (f/k/a White Rose Inc.) filed approximately 27 avoidance actions, and RT Liquidation Corp. (f/k/a Rose Trucking Corp.) filed 11 avoidance actions.
The ADI Liquidation Debtors filed voluntary petitions for bankruptcy in the U.S. Bankruptcy Court for the District of Delaware on September 9, 2014 under Chapter 11 of the Bankruptcy Code. A hearing on the confirmation of the Debtors’ Second Amended Chapter 11 Plan of Liquidation is scheduled for September 30, 2016.
The various avoidance actions are pending before the Honorable Kevin J. Carey. The pretrial conference has not yet been scheduled.
For preference defendants looking for an analysis of defenses that can be asserted in response to a preference complaint, below are several articles on this topic:
Preference Payments: Brief Analysis of Preference Actions and Common Defenses
Minimizing Preference Exposure: Require Prepayment for Goods or Services
Minimizing Preference Exposure (Part II) – Contemporaneous Exchanges
Carl D. Neff is a partner with the law firm of Fox Rothschild LLP. You can reach Carl at (302) 622-4272 or at email@example.com.