Burbage & Weddell LLC Defending Bankruptcy Preference Claims Nationwide: 888.547.5170
On November 26, 2012, Brian Cejka, Trustee of the Palm Harbor Liquidating Trust in the Palm Harbor Homes, Inc. n/k/a PHH Co., Inc. Bankruptcy, commenced Section 547 preferential transfer recovery litigation in the District of Delaware.
The associated debtors were manufacturers and marketers of factory-built homes. Operations were disbursed nationwide and vertically integrated. As a result, the defendants in these preference actions run across a large number of industry segments. This is the likely cause of a concentration of small and middle market defendants. There also is a higher than usual concentration of smaller preference claims, which will stress the economics of any protracted defense.
The complaints are straight forward 547 preference complaints. In addition to foregoing extraneous avoidance claims, the complaints show an appreciation of Delaware Bankruptcy Court decisions in 2010 and 2011 establishing stricter pleading standards for preference actions. Motions to dismiss, for this reason, are likely to be few in number.
The information contained on Exhibit A to the complaints generally reflect a probability of extensive subsequent new value and the need to optimize its application with other defenses.
Debtor and Bankruptcy Case Overview
Lead Bankruptcy Case Name (Case Number): Palm Harbor Homes, Inc. n/k/a PHH Co., Inc. (10-13850)
Bankruptcy Court District (Division): District of Delaware
Petition Date: November 29, 2010
Associated Debtors: Palm Harbor Albemarle, LLC; Palm Harbor Homes, Inc.; Palm Harbor Real Estate, LLC; Palm Harbor GenPar, LLC; Palm Harbor Manufacturing, LP; Nationwide Homes, Inc.
Debtors' Industry Group: Prefabricated Wood Bldgs & Components (SIC 2452)
Debtors' Business: manufacturer and marketer of factory-built homes
Primary Industry Groupings of Defendants: Transportation; Material Suppliers; General Trade Transportation services (SIC 4700)
Adversary Proceedings Overview
Plaintiff: Brian Cejka, Trustee of the Palm Harbor Liquidating Trust
Number of Proceedings: 113
When Filed: from November 26, 2012 through November 28, 2012
Adversary Proceeding Judge: U.S. Bankruptcy Judge Christopher S. Sontchi
Plaintiff's Counsel: Pachulski Stang Ziehl & Jones LLP through its attorneys Laura Davis Jones, Andrew W. Caine, Steven J. Kahn and Timothy P. Cairns
Avoidance Period: The complaint identifies the preference period as the period "during the 90 days before the Petition Date".