More Leverage for Suppliers, but No Quick Payday
As most savvy collection managers know, the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA) granted suppliers a priority in payment for goods received by the debtor within 20 days before bankruptcy. The new statute undoubtedly increased the chances that suppliers will achieve a significant recovery. However, the courts have made it clear that Congress did not guarantee suppliers instant gratification on their newly created administrative priority claims.
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