Armstrong Flooring, Inc. – Preference and Fraudulent Transfer Defense Lawyer

Beginning on January 30, 2023, Plaintiff Armstrong Flooring, Inc., one of the debtors and debtors in possession in the Chapter 11 cases of Armstrong Flooring, Inc. and the below related Debtors filed 72 complaints, opening adversary proceedings, seeking to avoid and recover certain allegedly preferential or fraudulent transfers and to disallow the claim(s) held by individual defendants.

The Debtors in these chapter 11 cases are: Armstrong Flooring, Inc.; AFI Licensing LLC (3265); Armstrong Flooring Latin America, Inc.; and Armstrong Flooring Canada Ltd.

Specifically, Plaintiff seeks to claw back certain payments made to the individual Defendants, avoiding and recovering all (a) preferential transfers of property of the Debtors that occurred during the ninety (90) day period prior to the commencement of the bankruptcy proceedings, pursuant to sections 547 and 550 of the Bankruptcy Code and, (b) transfers that may have been fraudulent conveyances pursuant to sections 548 and 550 of the Bankruptcy Code.

In addition, Plaintiff seeks to disallow, pursuant to sections 502(d) and (j) of the Bankruptcy Code, any claim that Defendant has filed or asserted against the Debtors or that has been scheduled for Defendant.

Procedural History:

On May 8, 2022, each of the Debtors commenced a voluntary case under chapter 11 of the Bankruptcy Code.

On May 11, 2022, the Court entered an order authorizing the joint administration of the chapter 11 cases for procedural purposes pursuant to Bankruptcy Rule 1015(b) [D.I. 88].2

On May 18, 2022, the United States Trustee for the District of Delaware appointed the Official Committee of Unsecured Creditors. No trustee or examiner has been appointed.

The bankruptcy case and these adversary actions are before the Honorable Judge Mary F. Walrath.

Background, as alleged by Plaintiff:

“[T]he Debtors were a leading global producer of resilient flooring products for use primarily in the construction and renovation of commercial, residential, and institutional buildings. The Debtors sold their products in North American commercial and residential markets as well as in commercial markets in the Pacific Rim. The majority of the Debtors’ sales were in North America, where the Debtors were the largest producer of resilient flooring products.”

Common Defenses in Preference Actions

The United States Bankruptcy Code provides many affirmative defenses to preference actions, contained within Section 547(c). For example, the most common defenses that may be available to a Defendant under Section 547(c) may include:

• the transfer was a contemporaneous exchange for new value given to the debtor (i.e., the debtor received something of value in exchange for the transfer); 11 U.S.C. §547(c)(1);
• after such transfer, Defendant gave new value to or for the benefit of the debtor (i.e., the Defendant extended additional credit to the Debtor after receiving the transfer) 11 U.S.C. §547(c)(4); or
• the transfer was in payment of a debt incurred by the debtor in the ordinary course of business or financial affairs of the debtor and the recipient (i.e., Defendant made the transfer under ordinary business terms). 11 U.S.C. §547(c)(2).

For more information, see our page on Preference Defense Litigation: http://www.tobialaw.com/practice-areas/delaware-preference-defense-lawyer/

The following Adversary Proceedings were filed in the Delaware Bankruptcy Case of Armstrong Flooring, Inc.

23-50014-MFW Armstrong Flooring, Inc. v. 360insights (Canada) Ltd.
23-50015-MFW Armstrong Flooring, Inc. v. Kushner
23-50016-MFW Armstrong Flooring, Inc. v. J & M Tank Lines, Inc.
23-50017-MFW Armstrong Flooring, Inc. v. L.E.K. Consulting, LLC
23-50018-MFW Armstrong Flooring, Inc. v. Labware Global Services, Inc.
23-50019-MFW Armstrong Flooring, Inc. v. Carrillo
23-50020-MFW Armstrong Flooring, Inc. v. Aqua Illinois, Inc.
23-50021-MFW Armstrong Flooring, Inc. v. Arch Floors, Inc.
23-50022-MFW Armstrong Flooring, Inc. v. Ariba, Inc.
23-50023-MFW Armstrong Flooring, Inc. v. Aspen Square Management, Inc.
23-50024-MFW Armstrong Flooring, Inc. v. Montebello Distribution Associates
23-50025-MFW Armstrong Flooring, Inc. v. AVI-SPL LLC
23-50026-MFW Armstrong Flooring, Inc. v. NFM/Welding Engineers, Inc.
23-50027-MFW Armstrong Flooring, Inc. v. Avnet, Inc.
23-50028-MFW Armstrong Flooring, Inc. v. Nittany Oil Company
23-50029-MFW Armstrong Flooring, Inc. v. C.H. Robinson Worldwide, Inc.
23-50030-MFW Armstrong Flooring, Inc. v. CBT Integrated Logistics, LLC
23-50031-MFW Armstrong Flooring, Inc. v. NOX Corporation
23-50032-MFW Armstrong Flooring, Inc. v. One Gas, Inc.
23-50033-MFW Armstrong Flooring, Inc. v. CDK Industrial Solutions Corporation
23-50034-MFW Armstrong Flooring, Inc. v. Otis Elevator Company
23-50035-MFW Armstrong Flooring, Inc. v. Charter Dura-Bar, Inc.
23-50036-MFW Armstrong Flooring, Inc. v. Pathward Financial, Inc.
23-50037-MFW Armstrong Flooring, Inc. v. Pinterest, Inc.
23-50038-MFW Armstrong Flooring, Inc. v. Chase Cost Management, LLC
23-50039-MFW Armstrong Flooring, Inc. v. Chemclene Corporation
23-50040-MFW Armstrong Flooring, Inc. v. Precision Roll Grinders, Inc.
23-50041-MFW Armstrong Flooring, Inc. v. CMA CGM (America) LLC
23-50042-MFW Armstrong Flooring, Inc. v. ReliaQuest, LLC
23-50043-MFW Armstrong Flooring, Inc. v. Colorants Solutions USA LLC
23-50044-MFW Armstrong Flooring, Inc. v. Right Turn Promotions, LLC
23-50045-MFW Armstrong Flooring, Inc. v. Corporate Realty, Design & Management Institute
23-50046-MFW Armstrong Flooring, Inc. v. Robert Half International Inc.
23-50047-MFW Armstrong Flooring, Inc. v. Criterion Supply, Inc.
23-50048-MFW Armstrong Flooring, Inc. v. Rockwell Automation, Inc.
23-50049-MFW Armstrong Flooring, Inc. v. Datasite LLC
23-50050-MFW Armstrong Flooring, Inc. v. Roy Johnson, Incorporated
23-50051-MFW Armstrong Flooring, Inc. v. Dec Tool, Corp.
23-50052-MFW Armstrong Flooring, Inc. v. Schneider.com, Inc.
23-50053-MFW Armstrong Flooring, Inc. v. Delta Ducon LLC
23-50054-MFW Armstrong Flooring, Inc. v. SHI International Corp.
23-50055-MFW Armstrong Flooring, Inc. v. Design Analytics
23-50056-MFWArmstrong Flooring, Inc. v. Diverzify+ LLC
23-50057-MFW Armstrong Flooring, Inc. v. Dodge Data & Analytics LLC
23-50058-MFW Armstrong Flooring, Inc. v. Emerald Expositions, LLC
23-50059-MFW Armstrong Flooring, Inc. v. Enowa LLC
23-50060-MFW Armstrong Flooring, Inc. v. TBL Services, Inc. et al
23-50061-MFW Armstrong Flooring, Inc. v. Flexport, Inc.
23-50062-MFW Armstrong Flooring, Inc. v. Fountain Construction Co., Inc.
23-50063-MFW Armstrong Flooring, Inc. v. TBL Services, Inc. et al
23-50064-MFW Armstrong Flooring, Inc. v. H. B. Fuller Co.
23-50065-MFW Armstrong Flooring, Inc. v. TBL Services, Inc.
23-50066-MFW Armstrong Flooring, Inc. v. ICR, LLC
23-50067-MFW Armstrong Flooring, Inc. v. TBL Services, Inc. et al
23-50068-MFW Armstrong Flooring, Inc. v. TBL Services, Inc. et al
23-50069-MFW Armstrong Flooring, Inc. v. The Drees Company
23-50070-MFW Armstrong Flooring, Inc. v. In Store Experience, Inc.
23-50071-MFW Armstrong Flooring, Inc. v. The Target Group, Inc.
23-50072-MFW Armstrong Flooring, Inc. v. Interior Design Media Group, LLC
23-50073-MFW Armstrong Flooring, Inc. v. Two Dudes Painting Company
23-50074-MFW Armstrong Flooring, Inc. v. Venator Americas LLC
23-50075-MFW Armstrong Flooring, Inc. v. Victory Packaging, L.P.
23-50076-MFW Armstrong Flooring, Inc. v. Win Ton Plastics Industry Co., Ltd.
23-50077-MFW Armstrong Flooring, Inc. v. Worldline Group S.A.
23-50078-MFW Armstrong Flooring, Inc. v. Xpress Global Systems, LLC
23-50079-MFW Armstrong Flooring, Inc. v. Yibin Tianchang Logistics Co., Ltd.
23-50080-MFW Armstrong Flooring, Inc. v. Yibin Tianyi New Materials Technology Co. Ltd.
23-50081-MFW Armstrong Flooring, Inc. v. Zapproved LLC
23-50082-MFW Armstrong Flooring, Inc. v. Zhejiang Tianzhen Bamboo & Wood Development Co. Lt
23-50083-MFW Armstrong Flooring, Inc. v. ZIM American Integrated Shipping Services Company23-50119-MFW Armstrong Flooring, Inc. v. Greif, Inc.

If you conducted business with any of the Armstrong Flooring, Inc. affiliated debtors and especially if you have received a demand letter, or if a complaint has been filed against you or your business, even if not served yet, contact us here, email us at info@tobialaw.com or call the firm’s Wilmington offices directly at (302) 655-5303 to schedule an initial consultation. We can discuss the situation you are facing and share with you our initial observations at no charge.