Case Dismissed for No Payment Right Before Mediation

Before the bankruptcy, the Debtors were a leading producer and processor of value-added petrochemical raw materials such as C4 hydrocarbons.

The Defendant specialized in assisting clients and customers in system design, service and repair, and fluid conveyance.

The Plaintiff filed a Complaint with claims for Avoidance of Preferential Transfers under 11 U.S.C. § 547 and Fraudulent Conveyances under 11 U.S.C. § 548 and 11 U.S.C. § 550 against the Defendant. The Plaintiff sought to recover transfers the Debtors made to the Defendant in exchange for Defendant’s services to the Debtors.

The Court ordered that the case be mediated. Before the mediation date, we asserted to Plaintiff that Defendant’s supply of goods to the Debtors was within the scope of Defendant’s normal business operations, just as the Debtors’ acceptance of Defendant’s Goods was in the ordinary course of their business operations. We showed the Plaintiff proof that the transfers were made pursuant to the Ordinary Course of Business between the Debtors and the Defendant.

Mere days before the mediation date, the Plaintiff informed us they were dismissing the Complaint for no payment.

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