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Aug 09, 2016

Not So Safe After All?

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On June 20, 2016, the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) denied in part a motion to dismiss and allowed state law constructive fraudulent transfer claims to proceed, despite the fact that such claims likely would have been precluded by the Bankruptcy Code’s safe harbors if brought pursuant to federal law.  This decision is notable in that it contradicts a recent decision by the Second Circuit Court of Appeals in Tribune,  which held that creditors are preempted from asserting state law constructive fraudulent conveyance claims by virtue of the Bankruptcy Code’s safe harbors.

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Authors and Contributors

Fredric Sosnick

Partner

Financial Restructuring & Insolvency

+1 212 848 8571

+1 212 848 8571

New York

Joel Moss

Partner

Financial Restructuring & Insolvency

+1 212 848 4693

+1 212 848 4693

New York

Solomon J. Noh

Partner

Financial Restructuring & Insolvency

+44 20 7655 5795

+44 20 7655 5795

London

Ned S. Schodek

Partner

Financial Restructuring & Insolvency

+1 212 848 7052

+1 212 848 7052

New York