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ABI Journal

Unsecured Trade Creditors

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.

Read the full article, see attachment.