Bankruptcy Preference Creditor's Digest

Lyondell Chemical – Current APScan of Bankruptcy Adversary Proceedings to Recover Preferential Transfers

This APScans reports the recent substantive filings made in the Lyondell Chemical Company adversary proceedings for recovery of preferential transfers under section 547 of the Bankruptcy Code (bankruptcy preferences). The adversary proceedings were brought by Edward S. Weisfelner, as Trustee of the LB Litigation Trust.

Click this link to see a Lyondell Chemical APScans CDDJ Report – Complaints, Dismissals, Defaults, Judgments

Related Materials:

05/10/2011 - Defendant's Motion to Dismiss filed in AP No.: 10-05672 - Defendant Thermon Heat Tracing Services Inc. -  A multi-tiered attack on the standing of the Trustee of the LB Litigation Trust and hence the Court's jurisdiction over the preference action.

Adversary Proceedings Overview

The Third Amended and Restated Joint Chapter 11 Plan of Reorganization for the LyondellBasell Debtors was confirmed on April 23, 2010 and became effective on April 30, 2010. Pursuant to the Plan, the LB Litigation Trust was established for the purpose of pursuing certain claims for the benefit of holders of Allowed General Unsecured Claims and 2015 Notes Claims. The Debtors assigned certain claims of the Debtors’ estates that could be brought under section 547 of the Bankruptcy Code or in the alternative based upon the same underlying facts under section 548 of the Bankruptcy Code and the right to recover on account of such claim under section 550 of the Bankruptcy Code.

The body of the complaints is a mere recitations of the statutory requirements. The Exhibit A identification of transfers provides an identification of the transferor Associated Debtor and the invoice being paid (the antecedent debt) is identified by number and date.

With 93 different debtors, insolvency is always a question to be evaluated on a debtor by debtor basis. Unfortunately, on the liability side, the Schedules of Assets and Liabilities will frequently not provide any guidance. The $17,095,639,048 in secured claims is repeated on many of the schedules. If solvency is indicated after excluding the secured debt, whether there is a basis for allocation of the secured debt is a question that may need to be addressed.

Click on the following links to see more articles on "APScans, Lyondell Chemical, Manufacturing - Chemicals and Allied Products ". First Published December 19th, 2010.