Fraudulent Transfers

First and Second Circuits Agree: Trustees Alone May Sue Ponzi Scheme Net Winners

Rulings by the First and Second Circuits ensure that recoveries by a Ponzi scheme trustee will be distributed to all victims, not just those who sue on their own.

To Sue a Subsequent Transferee, Proving a Fraudulent Transfer Isn’t Always Required

A subsequent transferee may be entitled to challenge a fraudulent transfer judgment from a prior suit against the initial transferee.

A Parent’s Quid Pro Quo: Trustee Avoidance Cases to Recover Debtor Payments for Their Children’s Education

Nov 2019

Avoidance Issues

May a Trustee Recover Proceeds from Fraudulently Transferred Property?

Courts disagree on whether a trustee may recover proceeds of a fraudulent transfer from a later transferee, not only the fraudulently transferred property itself.

Restructuring a Distressed Health Care Portfolio Company

Oct 2019

Chapter 7 Debtor’s Counsel Permitted to Defend Creditors in Avoidance Suits

Bankruptcy Judge Carol A. Doyle parses the limited duties of a chapter 7 debtor to the estate.

Good-Faith Affirmative Defenses and the “At Issue” Doctrine

Nov 2019

Second Circuit Defines a Prohibited Double Recovery on Fraudulent Transfers

There is no prohibited double recovery from multiple defendants, the appeals courts says, until the trustee has recovered cash equaling the value of the fraudulently transferred property.

Trustee Allowed to Sue for Fraudulent Transfer on an Unenforceable Contract

Long Island’s Judge Grossman follows the Third Circuit by finding limitations on the Rooker-Feldman doctrine.