On on December 5, 2012, Charles A. Stanziale, Jr., Chapter 7 Trustee in the Conex Holdings, LLC Bankruptcy, commenced mass Chapter 5 preferential transfer recovery litigation in the Bankruptcy Court for the District of Delaware. The Debtors bankruptcy case was commenced by the filing of an involuntary petition by three secured creditors, and trade creditors seemingly were caught off guard. Unlike many Chapter 7 involuntary cases, the pool of trade creditor defendants is quite large and many of the preference claims are substantial.
The Chapter 7 Trustee apparently does not have access to much of the Debtors’ trade creditor information. The complaints are weak in the identification of antecedent debt. However, the Trustee may benefit from some leniency in pleading standard application afforded Chapter 7 trustees by the Delaware Bankruptcy Court.