On February 18, 2022, Plaintiff Advisory Trust Group, LLC, in its capacity as Trustee2 of the Creditors’ Trust of Hygea Holdings Corp. began filing complaints in 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 23 such complaints have been filed.
The Reorganized Debtor in this chapter 11 case is Hygea Health Holdings, Inc. On June 17, 2021, the Court entered an order closing the chapter 11 cases of Hygea Holdings Corp. and its debtor affiliates, which include: All Care Management Services, Inc.; First Harbour Health Management, LLC; First Harbour Medical Centers, LLC; Florida Group Healthcare LLC; Gemini Healthcare Fund, LLC; Hygea Acquisition Longwood, LLC; Hygea Acquisition Orlando, LLC; Hygea IGP of Central Florida, Inc.; Hygea IGP, LLC; Hygea Medical Centers of Florida, LLC; Hygea Medical Partners, LLC; Hygea of Delaware, LLC; Hygea of Georgia, LLC; Hygea of Pembroke Pines, LLC; Hygea Primum Acquisition, Inc.; Medlife Activity Center, LLC; Mobile Clinic Services, LLC; Palm A.C. MSO, LLC; Palm Allcare Medicaid MSO, Inc.; Palm Allcare MSO, Inc.; Palm Medical Group, Inc.; Palm Medical MSO LLC; Palm Medical Network, LLC; Palm MSO System, Inc.; Palm PGA MSO, Inc.; Physician Management Associates East Coast, LLC; Physician Management Associates SE, LLC; Physicians Group Alliance, LLC; Primum Alternatives, Inc.; Primum Healthcare, LLC; and Professional Health Choice, Inc.
On February 19, 2020, each of the Debtors commenced a voluntary case under chapter 11 of the Bankruptcy Code.
On February 21, 2020, the Court entered an order for joint administration of these chapter 11 cases for procedural purposes.
On June 15, 2020, the Court entered its Findings of Fact, Conclusions of Law, and Order Approving and Confirming the Second Amended Joint Chapter 11 Plan of Reorganization of Hygea Holdings Corp. and its Affiliated Debtors.
The Creditors’ Trust was established as of July 15, 2020.
Creditors’ Trust Causes of Action, including avoidance actions under chapter 5 of the Bankruptcy Code such as those now being filed, were transferred to the Trust.
These adversary actions are before the Honorable Karen B. Owens.
Background, as alleged by Plaintiff:
"the Debtors were a consolidated enterprise of several companies that focused on the delivery of primary-care-based healthcare to approximately 190,000 commercial, Medicare and Medicaid patients in the southeast United States. The Debtors were headquartered in Miami, Florida and employed more than 150 individuals prior to entry of the Confirmation Order"
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 any of Hygea Holdings Corp. or its affiliated debtors and especially if you have received a