Three Things Trustees Should Know About Due Diligence in Preference Litigation

Courts have struggled with the interpretation of the 2019 amendment to Section 547, specifically whether the due diligence requirement is an element of a preference claim that must be adequately pleaded in the plaintiff's complaint. While the law is still developing, there are three important takeaways for trustees to consider.

6 minute read January 01, 2024 at 12:13 AM
By
Brad Jones
Three Things Trustees Should Know About Due Diligence in Preference Litigation

Preference recoveries brought under Section 547 of the Bankruptcy Code are one of the main litigation tools that bankruptcy trustees, debtors-in-possession and liquidating trustees can use to bring additional funds into a bankruptcy estate.

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