Bluefly Acquisition, LLC - Preference Defense Lawyer

On January 28, 2021, Jeoffrey L. Burtch, Chapter 7 trustee of Bluefly Acquisition, LLC began filing  complaints seeking to to avoid and recover preferential transfers and to disallow any claims held by the individual defendants.

The Trustee seeks to avoid and recover from the individual defendants, or from any other person or entity for whose benefit the transfers were made, all preferential transfers of property made for or on account of an antecedent debt made to or for the benefit of the Defendant by the Debtor during the ninety-day period prior to the filing of the Debtor’s bankruptcy petitions pursuant to 11 U.S.C. §§ 547 and 550.


Procedural History:

On February 1, 2019, the Debtor filed a voluntary petition for relief under Chapter 7 of the Bankruptcy Code. 

Jeoffrey L. Burtch was appointed as interim trustee on or about February 1, 2019.

These adversary actions are before the Honorable Christopher S. Sontchi.


Background, as alleged by Plaintiff:


Until its bankruptcy filing, the company, which was founded in 1998, operated a
well-known e-commerce fashion website selling clothing, accessories, and jewelry.


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 pages on Preference Defense Litigation: http://www.tobialaw.com/delaware-preference-defense-lawyer.html and Fraudulent Transfer Defense Litigation: https://www.tobialaw.com/defense-of-fraudulent-transfer-actions.html

If you conducted business with Bluefly Acquisition, LLC, and especially 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 a free initial consultation. We can discuss the situation and share with you our initial observations at no charge.

Contact Us