Burtch v. Voyager Pacific Opportunity Fund II, LLC

Summary

The United States Bankruptcy Court for the District of Delaware considered Voyager Pacific Opportunity Fund II, LLC’s motion to dismiss claims arising from a loan to the debtors and repayment of the loan. The court dismissed the constructive fraudulent-transfer claim as to repayment of the $750,000 principal and dismissed the claim seeking disallowance of Voyager’s claim, but allowed the actual fraudulent-transfer claim to proceed. The opinion was issued in the chapter 7 bankruptcy of BW Industries, Inc. and related debtors.

Holdings

1. The trustee failed to state a plausible constructive fraudulent-transfer claim as to the $750,000 principal repayment because the Debtors received the same amount from Voyager and repayment of that amount constituted reasonably equivalent value.
2. Providing reasonably equivalent value or satisfying an antecedent debt does not categorically bar an actual fraudulent-transfer claim under 11 U.S.C. § 548(a)(1)(A). The trustee plausibly alleged that Voyager's principal knew of the Debtors' financial difficulties and allegedly fraudulent conduct, so Count 4 survived dismissal.
3. Count 6 was dismissed because Voyager had not filed a claim in the Debtors' bankruptcy cases, and the trustee did not oppose dismissal.

Questions Presented

1. Whether the complaint stated a constructive fraudulent-transfer claim concerning repayment of the $750,000 loan principal.
2. Whether satisfaction of an antecedent debt for reasonably equivalent value categorically precludes an actual fraudulent-transfer claim under 11 U.S.C. § 548(a)(1)(A).
3. Whether the trustee could seek disallowance of Voyager's claims under 11 U.S.C. § 502(d) when Voyager had not filed a claim in the bankruptcy cases.

Disposition

other