Fraudulent Transfers

Earmarking Requires Dominion/Control and No Diminution of the Estate, Circuit Says

Invoking Supreme Court authority, the Tenth Circuit says that inferences from the evidence are reviewed for clear error just like findings of fact themselves.

Substantially Equivalent Value Not Required to Defeat Equitable Disgorgement

The standard for defeating equitable disgorgement is lower than the proof required to fend off receipt of a fraudulent transfer.

Setoff Can’t Be Raised as a Defense to Receipt of a Fraudulent Transfer

The Madoff case makes more law: A claim against a bankrupt estate can’t be set off against liability for receipt of a fraudulent transfer because one arose before bankruptcy and the other arose after.

Judge Goldblatt on the Imputation of Fraudulent Intent to a Delaware Corporation

The fraudulent intent of an individual who controls a corporation can be imputed to the corporation itself, even if the board is unaware of fraud.

Fifth Circuit Expands Bartenwerfer to Saddle Alter Egos with Nondischargeable Debts

An alter ego may be of the same ilk as a partnership or agency, so there may be no inconsistency between the Fifth Circuit opinion and the Bartenwerfer concurrence.

It’s Ok to Avoid a Fraudulent Transfer Even if It Makes the Debtor Solvent, Circuit Says

The Second Circuit found discretion to avoid a constructively fraudulent transfer of exempt property that would have enabled the debtor to pay her creditors in full.