October 31, 2009
Parties to preference and fraudulent transfer actions should pay careful attention to the decision in Angell, Trustee v. Ber Care, Inc. f/k/a PPS, Inc., et al. (In re Caremerica, Inc.), 409 B.R. 737 (Bankr. E.D.N.C. 2009). There, relying upon the new standard for assessing the sufficiency of a complaint set forth by the Supreme Court in Belt Atl. Corp. v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 129 S.Ct. 1937 (2009), Bankruptcy Judge J. Rich Leonard dismissed certain avoidance claims and upheld others asserted by a Chapter 7 trustee. Caremerica provides useful guidance on whether particular elements of a preference or fraudulent transfer claim have been adequately pled.
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