Opinions

The District of Northern Illinois offers a database of opinions for the years 1999 to 2013, listed by year and judge. For a more detailed search, enter the keyword or case number in the search box above.

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Judge Timothy A. Barnes

09 B 39937, 11 A 02224
Upon the Defendant’s motion to dismiss the Chapter 11 Plan Administrator’s adversary proceeding, seeking to avoid and recover as fraudulent transfers lease payments transferred from the Debtor to the Defendant that purportedly were part of fraudulent scheme, held: (i) that the Debtor may have received “reasonably equivalent value” was not fatal to cause of action to avoid lease payments as actually, and not just constructively, fraudulent transfers; (ii) the Plan Administrator did not have to identify a specific unsecured “triggering creditor” that was in existence at time of challenged transfers in order to state cause of action to avoid transfers as actually fraudulent to creditors under Illinois law, in exercise of 11 U.S.C. § 544(b) strong-arm powers due to scores of unsecured claimants; but (iii) the Plan Administrator failed to adequately allege Ponzi-type scheme and to explain how challenged payments were used to further alleged scheme and harm the Debtor’s other creditors.  Motion to dismiss granted in part and denied in part.

09 B 39937, 11 A 02201
Upon the Defendant’s motion to dismiss the Chapter 11 Plan Administrator’s adversary proceeding, seeking to avoid and recover as fraudulent transfers lease payments transferred from the Debtor to the Defendant that purportedly were part of fraudulent scheme, held: (i) the defense of in pari delicto was unavailable to the Defendant because the claims were not claims that the Debtor could itself have asserted outside of bankruptcy; (ii) the Defendant did not conclusively establish the 11 U.S.C. § 547(c)(2) “ordinary course of business” defense and the Plan Administrator was not required to preemptively please facts negating the defense; but (iii) the Plan Administrator failed to adequately allege Ponzi-type scheme and to explain how challenged payments were used to further alleged scheme and harm the Debtor’s other creditors.  Motion to dismiss granted.

09 B 39937, 11 A 02218
Upon the Defendant’s motion to dismiss the Chapter 11 Plan Administrator’s adversary proceeding, seeking to avoid and recover as fraudulent transfers lease payments transferred from the Debtor to the Defendant that purportedly were part of fraudulent scheme, held: (i) allegations in complaint did not establish “good faith and for value” defense on face of complaint for purposes of 11 U.S.C. § 548(c); (ii) the Plan Administrator did not have to identify a specific unsecured “triggering creditor” that was in existence at time of challenged transfers in order to state cause of action to avoid transfers as actually fraudulent to creditors under Illinois law, in exercise of 11 U.S.C. § 544(b) strong-arm powers due to scores of unsecured claimants; but (iii) the Plan Administrator failed to adequately allege Ponzi-type scheme and to explain how challenged payments were used to further alleged scheme and harm the Debtor’s other creditors.  Motion to dismiss granted.

09 B 39937, 11 A 02231
Upon the Defendant’s motion to dismiss the Chapter 11 Plan Administrator’s adversary proceeding, seeking to avoid and recover as fraudulent transfers lease payments transferred from the Debtor to the Defendant that purportedly were part of fraudulent scheme, held: (i) allegations in complaint did not establish “good faith and for value” defense on face of complaint for purposes of 11 U.S.C. § 548(c); (ii) the Plan Administrator did not have to identify a specific unsecured “triggering creditor” that was in existence at time of challenged transfers in order to state cause of action to avoid transfers as actually fraudulent to creditors under Illinois law, in exercise of 11 U.S.C. § 544(b) strong-arm powers due to scores of unsecured claimants; but (iii) the Plan Administrator failed to adequately allege Ponzi-type scheme and to explain how challenged payments were used to further alleged scheme and harm the Debtor’s other creditors.  Motion to dismiss granted.

09 B 39937, 11 A 02582
Upon the Defendant’s motion to dismiss the Chapter 11 Plan Administrator’s adversary proceeding, seeking to avoid and recover as fraudulent transfers lease payments transferred from the Debtor to the Defendant that purportedly were part of fraudulent scheme, held: (i) the Plan Administrator did not have to identify a specific unsecured “triggering creditor” that was in existence at time of challenged transfers in order to state cause of action to avoid transfers as actually fraudulent to creditors under Illinois law, in exercise of 11 U.S.C. § 544(b) strong-arm powers due to scores of unsecured claimants; but (ii) the Plan Administrator failed to adequately allege Ponzi-type scheme and to explain how challenged payments were used to further alleged scheme and harm the Debtor’s other creditors.  Motion to dismiss granted.

09 B 39937, 11 A 02227
Upon the Defendant’s motion to dismiss the Chapter 11 Plan Administrator’s adversary proceeding, seeking to avoid and recover as fraudulent transfers lease payments transferred from the Debtor to the Defendant that purportedly were part of fraudulent scheme, held: (i) that the Debtor may have received “reasonably equivalent value” was not fatal to cause of action to avoid lease payments as actually, and not just constructively, fraudulent transfers; but (ii) the Plan Administrator failed to adequately allege Ponzi-type scheme and to explain how challenged payments were used to further alleged scheme and harm the Debtor’s other creditors.  Motion to dismiss granted.

09 B 39937, 11 A 02233
Upon the Defendant’s motion to dismiss the Chapter 11 Plan Administrator’s adversary proceeding, seeking to avoid and recover as fraudulent transfers lease payments transferred from the Debtor to the Defendant that purportedly were part of fraudulent scheme, held: (i) allegations in complaint did not establish “good faith and for value” defense on face of complaint for purposes of 11 U.S.C. § 548(c); (ii) the Plan Administrator did not have to identify a specific unsecured “triggering creditor” that was in existence at time of challenged transfers in order to state cause of action to avoid transfers as actually fraudulent to creditors under Illinois law, in exercise of 11 U.S.C. § 544(b) strong-arm powers due to scores of unsecured claimants; but (iii) the Plan Administrator failed to adequately allege Ponzi-type scheme and to explain how challenged payments were used to further alleged scheme and harm the Debtor’s other creditors.  Motion to dismiss granted.

10 B 10717, 10 A 01418
Upon the Debtor’s motion for sanctions and attorney’s fees against the Plaintiff for continued prosecution of nondischargeability adversary despite failing to allege sufficient grounds in an amended complaint, held: although the Plaintiff violated Rule 9011 and did not act reasonably in commencing and continuing this adversary proceeding, the Debtor’s motion for sanctions failed to set forth the basis for her request for sanctions as it lacked the requisite legal arguments and citations to relevant facts to support the Debtor’s request for sanctions.  Motion for sanctions denied.

Judge A. Benjamin Goldgar

Judge Jack B. Schmetterer

In re 211 Waukegan LLC
September 18, 2012

11 B 13104

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