09 B 39937, 11 A 02203
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) 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); (iii) 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 (iv) 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.