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/delaware-preference-defense-lawyer.html

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 Corporation
23-50747-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.
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