Port Neches Fuels, LLC – Preference and Fraudulent Transfer Defense Lawyer

Beginning on October 3, 2023, Plaintiff Edgar C. Gentle, III, as GUC Trustee of the TPC GUC Trust began filing complaints, thus opening adversary proceedings, seeking: (1) to avoid certain alleged transfers as preferential under Section 547 and/or fraudulent under Section 548 of the Bankruptcy Code, and recover under Section 550 and (2) to disallow the claim(s) held by individual defendants under Section 502.

Approximately 68 such complaints have been filed so far.

The bankruptcy case and these adversary actions are before the Honorable Judge Craig T. Goldblatt.

Background as alleged in the Complaints:

As more fully discussed in the Disclosure Statement, the Debtors were a leading producer and processor of value-added petrochemical raw materials such as C4 hydrocarbons. The Debtors’ products were sold to producers in a wide range of markets, including synthetic rubber, fuels, lubricant additives, plastics, and surfactants. The Debtors also operated several production and/or processing facilities and maintained approximately 230 miles of feedstock and product pipelines. One of the production facilities, located in Port Neches, Texas, was shut down for processing after several explosions occurred at the plant on November 27, 2019.
Prior to the Petition Date, the Debtors, as producer of value-added petrochemical raw materials, maintained business relationships with various business entities, through which the Debtors regularly purchased, sold, received, and/or delivered goods and services. The Debtors also regularly paid for services used to facilitate its business.

Procedural History:

On June 1, 2022 (the “Petition Date”), each of the Debtors commenced a voluntary case under chapter 11 of the Bankruptcy Code.

On June 2, 2022, the Court entered an order authorizing the joint administration of the chapter 11 cases for procedural purposes under the TPC Inc. Group bankruptcy case, Case No. 20-10493.

On December 1, 2022, the Court entered an order (the “Confirmation Order”) confirming the Modified Second Amended Joint Chapter 11 Plan of TPC Group Inc. and Its Debtor Affiliates (the “Plan”) and all Plan supplements, including the GUC Trust Agreement.

In accordance with the Plan and Confirmation Order, the TPC GUC Trust (the “Trust”) was established as of the Effective Date of the Plan, December 16, 2022 and the Debtors and the Trustee entered into that certain GUC Trust Agreement.3

Pursuant to paragraph 39 of the Confirmation Order and Section 5.20 of the Plan, the GUC Trust Assets (as defined in the Plan), including all Assigned Causes of Action under Chapter 5 of the Bankruptcy Code, were transferred to the Trust.

Pursuant to the Plan, Confirmation Order, and GUC Trust Agreement, Plaintiff was appointed as the Trustee. Plaintiff is authorized and has standing, among other things, to prosecute and settle certain causes of action under chapter 5 of the Bankruptcy Code, including these avoidance actions.

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 bankruptcy of Port Neches Fuels, LLC, Case No. 22-10500-CTG on October 3, 2023 (unless a different date is specified below).

23-50593-CTG Gentle, III v. 24 Hr Safety, LLC
23-50594-CTG Gentle, III v. W.I.T. Development and Contracting, Inc.
23-50595-CTG Gentle, III v. Vantage Solutions LLC
23-50596-CTG Gentle, III v. Uline, Inc.
23-50597-CTG Gentle, III v. Turbine Services, Ltd
23-50598-CTG Gentle, III v. Triple R Brothers, Ltd.
23-50599-CTG Gentle, III v. TransQuip USA, Inc.
23-50600-CTG Gentle, III v. Agilent Technologies, Inc.
23-50601-CTG Gentle, III v. Alamo Transformer Supply Company
23-50602-CTG Gentle, III v. Allegiant Industrial, LLC
23-50603-CTG Gentle, III v. AMETEK, Inc.
23-50604-CTG Gentle, III v. Apex Trench and Mat, L.L.C.
23-50605-CTG Gentle, III v. Ares Commercial Finance LP
23-50606-CTG Gentle, III v. Axis Mechanical Group, Inc.
23-50607-CTG Gentle, III v. Beaed, L.P.
23-50608-CTG Gentle, III v. Blue Triton Brands, Inc.
23-50609-CTG Gentle, III v. Bourque Logistics, LLC
23-50610-CTG Gentle, III v. Brask, Inc. – Neela
23-50611-CTG Gentle, III v. Brenntag Southwest, Inc.
23-50612-CTG Gentle, III v. Cooling Towers, LLC
23-50613-CTG Gentle, III v. Custom Solutions Group LLC
23-50614-CTG Gentle, III v. Direct Energy, LP
23-50615-CTG Gentle, III v. Emerson Process Management LLLP
23-50616-CTG Gentle, III v. Enverus, Inc.
23-50617-CTG Gentle, III v. Event Solutions of Louisiana, L.L.C.
23-50618-CTG Gentle, III v. Flanders Electric Inc.
23-50619-CTG Gentle, III v. Flowserve US Inc.
23-50620-CTG Gentle, III v. Frontline Food Services, LLC
23-50621-CTG Gentle, III v. Greenwood Manufacturing Inc.
23-50622-CTG Gentle, III v. Hoerbiger Service Inc.
23-50623-CTG Gentle, III v. Houston Grinding & Manufacturing Co.
23-50624-CTG Gentle, III v. Hydraquip, Incorporated
23-50625-CTG Gentle, III v. International Manufacturers Representatives, Inc.
23-50626-CTG Gentle, III v. J.V. Industrial Companies, LLC
23-50627-CTG Gentle, III v. KAG Specialty Products Group, LLC
23-50628-CTG Gentle, III v. Kinetic Engineering Corporation
23-50629-CTG Gentle, III v. Leak Sealers, Inc.
23-50630-CTG Gentle, III v. McCarter Machine, Inc.
23-50631-CTG Gentle, III v. Micro Motion, Inc.
23-50632-CTG Gentle, III v. Mobile Mini, Inc.
23-50633-CTG Gentle, III v. Montrose Air Quality Services, LLC
23-50634-CTG Gentle, III v. Motion Industries, Inc.
23-50635-CTG Gentle, III v. New RKT LP
23-50636-CTG Gentle, III v. New-Hart Services, Inc.
23-50638-CTG Gentle, III v. PAS Global, LLC
23-50639-CTG Gentle, III v. Peak Roofing, Inc.
23-50640-CTG Gentle, III v. Plant Process Machine Works, LLC
23-50641-CTG Gentle, III v. PPI Engineering & Construction Services, LLC
23-50642-CTG Gentle, III v. Precision Machinery Contractors, LLC
23-50643-CTG Gentle, III v. PSRG, Inc.
23-50644-CTG Gentle, III v. Red Trident, Inc.
23-50645-CTG Gentle, III v. Reliability Controls Corporation
23-50646-CTG Gentle, III v. Rentech Boiler Systems, Inc.
23-50647-CTG Gentle, III v. Rosemount Inc.
23-50648-CTG Gentle, III v. Sandelius Instruments, Inc.
23-50649-CTG Gentle, III v. Siddons Martin Emergency Group, LLC
23-50650-CTG Gentle, III v. Smart Wave Solutions LLC
23-50651-CTG Gentle, III v. Smithwick Engineering, LLC
23-50652-CTG Gentle, III v. Structural Preservation Systems, LLC
23-50653-CTG Gentle, III v. Swift Technical Services, L.L.C.
23-50654-CTG Gentle, III v. Texas Outhouse, Inc.
23-50655-CTG Gentle, III v. T.F. Hudgins, Incorporated
23-50656-CTG Gentle, III v. The Vibration Guys, LLC
23-50657-CTG Gentle, III v. Thermo Electron North America LLC
23-50658-CTG Gentle, III v. Total Resource Management, Inc.
23-50659-CTG Gentle, III v. Toyota Motor Credit Corporation23-50747-CTG Gentle, III v. Flanders Electric, LLC (Oct. 16, 2023)
23-50757-CTG Gentle, III v. RKTM Acquisition Co, LCC (Nov. 8, 2023)

If you conducted business with Port Neches Fuels, LLC 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 explain the situation you are facing and your options and share with you our initial observations at no charge to you.