Perkins v. Haines, et al., No. 10-10683 (11th Cir. 2011)
Annotate this CaseInternational Management Associates, LLC, and several related entities (Debtors) were operated as the instruments of a Ponzi scheme. A receiver ultimately filed voluntary petitions in the bankruptcy court seeking relief for each of the Debtors under Chapter 11 of the Bankruptcy Code. A consolidated plan of liquidation was approved and a plan trustee appointed. The trustee then instituted a number of adversary proceedings in the bankruptcy court seeking to avoid and to recover distributions that had been made to the investors in the Debtors. The trustee claimed that transfers to the investors prior to the collapse of the Ponzi scheme were fraudulent transfers under 11 U.S.C. 548(a)(1)(A) and applicable state law. The investors asserted an affirmative defense under section 548(c), claiming that the transfers were for value. The trustee moved for partial summary judgment. The bankruptcy court denied the motion, effectively upholding the availability of the investors' affirmative defense. The trustee appealed. The court held that, under In re AFI Holdings, Inc. and the general rule, later transfers from the Debtors up to the amount of the investment satisfied the investor defendants' restitution or fraud claims and provided value to the Debtors. Accordingly, the bankruptcy court's judgment was affirmed.
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