F-Squared Investment Management LLC - Preference Defense Lawyer

On June 30, 2017,Craig Jalbert, in his Capacity as Trustee for F2 Liquidating Trust filed 28 preference complaints seeking to avoid and recover alleged preferential and/or fraudulent transfers pursuant to Sections 547, 548, and 550 of the United States Bankruptcy Code.

Background, as alleged by Plaintiff:

"...prior to the Petition Date, and for some time thereafter, the Debtors were SEC registered investment management and research firms with corporate headquarters in Wellesley, Massachusetts and a research and development team located in New Jersey. The Debtors’ clients generally were investment advisors who sold the Debtors’ investment portfolio model services to their own clients"

Procedural History:

The Debtors in these chapter 11 cases are:  F-Squared Investment Management, LLC; F-Squared Investments, Inc.; F-Squared Retirement Solutions, LLC; F-Squared Alternative Investments, LLC; F-Squared Solutions, LLC; F-Squared Institutional Advisors, LLC; F-Squared Capital, LLC; AlphaSector LLS GP 1, LLC; and Active Index Solutions, LLC. 

On July 8, 2015 (the “Petition Date”), each debtor (collectively, the “Debtors”) commenced their Bankruptcy Cases, as each filed in the United States Bankruptcy Court for the District of Delaware (the “Court”) a petition for relief under Chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”). 

These adversary actions and the Chapter 11 proceedings are before the Honorable Laurie S. Silverstein.

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/delaware-preference-defense-lawyer.html

If you conducted business with F-Squared Investment Management LLC or related entities, and especially if you have received a demand letter or complaint, 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 and share with you our initial observations at no charge.
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