Comcar Industries, Inc. – Preference and Fraudulent Transfer Defense Lawyer

On May 3, 2022, Plaintiff Patrick J. O’Malley, Liquidating Trustee of the Comcar Liquidating Trust began filing complaints initiating adversary proceedings, pursuant to sections 547, 548 and 550 of the Bankruptcy Code, seeking to avoid and recover certain transfers made to the individual defendant(s) within 90 days prior to the commencement of the Debtors’ Bankruptcy cases, or that may have been fraudulent conveyances, and to disallow any claims held by individual defendants.

To date, approximately 47 such complaints have been filed.

The Debtors in these chapter 11 cases are: 9th Place Newberry, LLC; 16th Street Pompano Beach, LLC; CCC Spotting, LLC; CCC Transportation, LLC; Charlotte Avenue Auburndale, LLC ; Coastal Transport, Inc.; Coastal Transport Logistics, LLC; Comcar Industries, Inc.; Comcar Logistics, LLC; Comcar Properties, Inc.; Commercial Carrier Corporation; Commercial Carrier Logistics, LLC; Commercial Truck and Trailer Sales Inc.; Cortez Blvd. Brooksville, LLC; CT Transportation, LLC; CTL Distribution, Inc.; CTL Distribution Logistics, LLC; CTL Transportation, LLC; Detsco Terminals, Inc.; Driver Services, Inc.; East Broadway Tampa, LLC; East Columbus Drive Tampa, LLC; Fleet Maintenance Services, LLC; MCT Transportation, LLC; Midwest Coast Logistics, LLC; Midwest Coast Transport, Inc.; New Kings Road Jacksonville, LLC; Old Winter Haven Road Auburndale, LLC; W. Airport Blvd. Sanford, LLC; Willis Shaw Logistics, LLC; and WSE Transportation, LLC.

Procedural History:

On May 17, 2020, each of the Debtors commenced a voluntary case under chapter 11 of the Bankruptcy Code.

On May 19, 2020, the Court entered an order authorizing the joint administration of the chapter 11 cases for procedural purposes pursuant to Bankruptcy Rule 1015(b).
On March 11, 2021, the Court entered its Order Confirming Amended Combined Disclosure Statement and Chapter 11 Plan of Liquidation.

In accordance with the Plan and Confirmation Order, the Trust was established and the Debtors and Plaintiff entered into that certain Liquidating Trust Agreement.

Pursuant to the Confirmation Order and the Plan, the Liquidating Trust Assets, including all non-released avoidance actions under Chapter 5 of
the Bankruptcy Code, were transferred to the Trust.

These adversary actions are before the Honorable Laurie S. Silverstein.

Background, as alleged by Plaintiff:

“[T]he Debtors were one of the largest privately owned transportation companies in the country with over forty strategically-located terminal and satellite locations nationwide. The Debtors were organized into four separate, stand-alone trucking business units, each primarily run by a general manager with profit and loss responsibility. The Debtors offered national truck transportation services, trucking warehousing, truck parts, and truck and trailer repairs to their customers.”

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/

If you conducted business with any of Comcar Industries, Inc. or its 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, 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.