Law.com Subscribers SAVE 30%
Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.
Court Rules Mere Conduit Defense Not Suitable for a Motion to Dismiss
At the motion to dismiss stage, courts usually won't consider affirmative defenses. This issue arose recently in a preferential transfer case, where a defendant sought to dismiss a complaint by arguing it was a mere conduit, not an initial transferee. But the court ruled against the defendant, explaining why it would not adjudicate a mere conduit defense on a motion to dismiss. Official Comm. of Unsecured Creditors of Pack Liquidating, LLC v. Kepler Grp., LLC, Adv. Proc. No. 23-50536 (In re Pack Liquidating, LLC), Case No. 22-10797, 2024 Bankr. LEXIS 2444 (Bankr. D. Del. Oct. 4, 2024).
Before their bankruptcy filings, the debtors sold consumer products online. The defendant in the preference action was an e-marketing services provider and an alleged agent of the debtors. In the debtors' Chapter 11 cases, the unsecured creditors' committee (Committee) sued the defendant to recover $389,000 transferred from the debtors. The complaint alleged that the defendant was the initial transferee of the funds. The complaint asserted a preferential transfer claim under Bankruptcy Code section 547 and a constructive fraudulent transfer claim under Bankruptcy Code section 548. The complaint also sought recovery from the defendant under Bankruptcy Code section 550.
The defendant licensed and installed advertising campaigns for the debtors that the defendant obtained from a third-party service provider. The service provider would bill the defendant for its services, then the defendant would invoice the debtors that amount plus a fee for its own work. The defendant would pay the service provider when the debtors paid the defendant.
This premium content is locked for Entertainment Law & Finance subscribers only
ENJOY UNLIMITED ACCESS TO THE SINGLE SOURCE OF OBJECTIVE LEGAL ANALYSIS, PRACTICAL INSIGHTS, AND NEWS IN ENTERTAINMENT LAW.
- Stay current on the latest information, rulings, regulations, and trends
- Includes practical, must-have information on copyrights, royalties, AI, and more
- Tap into expert guidance from top entertainment lawyers and experts
Already a have an account? Sign In Now Log In Now
For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473
AI Poisoning: A Self Help Cybersecurity Option
A novel legal self-help technique to secure artificial intelligence data and programs is known as Poisoning AI. This technique involves modifying the AI algorithm to intentionally produce specific erroneous results.
Life, Liberty, and the Pursuit of Customers: Developments on ‘Conquesting’ from the Ninth Circuit
In a recent decision, the U.S. Court of Appeals for the Ninth Circuit addressed the issue of whether purchasing market competitors’ search engine keyword terms, known as “conquesting,” constitutes trademark infringement.
DOJ Issues New Rule Regulating Handling of Bulk Sensitive Personal Data
The DOJ has proposed a rule that would regulate certain transactions involving bulk sensitive personal data. The rule would implement a complex regulatory framework, with civil and criminal enforcement, that is similar to sanctions and export licensing regimes. It also implicates federal cybersecurity requirements, government contracting and CFIUS actions.
Adapting for Success: Strategic Insights for Law Firms in 2025 and Beyond
The legal industry is at an inflection point, grappling with challenges that range from rising client demands to technological disruption. There are five critical areas where firms can take a proactive, strategic approach, including actionable insights and recommendations for navigating 2025 and beyond.
Second Circuit Clarifies Video Privacy Protection Act
The Second Circuit’s decision is notable in that it signals a reversal of the recent trend of dismissals of VPPA claims in courts across the country and could trigger a significant increase in VPPA lawsuits. Although organizations have grappled with VPPA claims for several years, this decision is another red flag to organizations to take immediate steps and ensure compliance with privacy laws to mitigate the risks of VPPA claims.