Commentary: 2nd Circuit Affirms Bankruptcy Court Decision Finding Actual Fraudulent Transfer and Breach of Fiduciary Duty in TransCare Case
The U.S. Court of Appeals for the Second Circuit decided In re TransCare Corp., No. 21-2547; 21-2576, affirming rulings from the United States District and Bankruptcy Courts for the Southern District of New York, which found that Lynn Tilton — the sole director and indirect owner of TransCare Corp. (the debtor) — breached her fiduciary duties to the debtor and caused other entities she directly and indirectly owned and controlled to engage in an actual fraudulent transfer of the debtor's assets, according to a Reuters commentary. In reaching its decision, the 2nd Circuit joined the 4th, 5th, 8th, and 9th Circuits in holding that a finding of fraudulent intent for purposes of a fraudulent transfer is reviewed for clear error — not de novo.
