RCT Wins Landmark Bankruptcy Decision in the Seventh Circuit
The Seventh Circuit overturned the dismissal of a $16.5 million fraudulent-transfer action under section 546(e) of the Bankruptcy Code in FTI Consulting v. Merit Management. The Seventh Circuit rejected the opinions of five other Circuit Courts of Appeal to hold that the section 546(e) safe harbor only applies where the debtor or the transferee-defendant is one of protected entities listed in the statute. This opinion opens additional avenues in the Seventh Circuit for trustees to seek recoveries on behalf of creditors. RCT represents FTI, in its capacity as a litigation trustee, in the action.
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Prior results do not guarantee a similar outcome.