Defending Preference and Fraudulent Transfer Demands from Bankruptcy Liquidating Trusts

Carl D. Neff, Partner | Pierson Ferdinand

Carl D. Neff is the managing partner of Pierson Ferdinand’s Wilmington, Delaware office. His practice centers on corporate and commercial litigation before the Delaware state courts and the United States District Court for the District of Delaware, and he regularly handles matters before the United States Bankruptcy Court for the District of Delaware, with significant experience litigating preference and avoidance action disputes.

• Education & Credentials

Carl earned his law degree from William and Mary Law School in 2005 and his undergraduate degree from Georgetown University in 2002. He served as a law clerk to the Honorable E. Norman Veasey, former Chief Justice of the Delaware Supreme Court, in 2003. He is admitted to practice in Delaware, New Jersey, New York, and the District of Columbia, and is a Delaware Superior Court Certified Mediator.

• Recognition & Leadership

Carl leads Pierson Ferdinand’s Wilmington office as its managing partner. He has mediated numerous disputes and serves as a volunteer mediator with the Delaware Justice of the Peace Court. He writes frequently on Delaware corporate law, with publications addressing amendments to the Delaware General Corporation Law, books and records demands under Section 220, and recent case law on stockholder agreements and controlling stockholder transactions.

• Professional Involvement

Carl is a member of the Delaware State Bar Association, the American Bankruptcy Institute, and the Richard S. Rodney American Inn of Court.

• Experience

In the bankruptcy arena, Carl has represented commercial landlords, utility companies, debtors, creditors, creditors’ committees, and litigation trusts. He has successfully defended numerous defendants sued for the recovery of preferential transfers under Section 547 of the Bankruptcy Code and fraudulent conveyances under Section 548, including defeating a motion for summary judgment against a defendant facing hundreds of thousands of dollars in alleged preferential transfers. He also represented a litigation trust in the Chem Rx Corporation bankruptcy, which commenced numerous avoidance actions and obtained a substantial recovery for the trust. Before Pierson Ferdinand, Carl was a partner at FisherBroyles, LLP and, earlier, at Fox Rothschild LLP in Wilmington, where he practiced in the firm’s Litigation, Financial Restructuring and Bankruptcy, and Directors and Officers Liability and Corporate Governance groups.

Rob Charles, Partner | Womble Bond Dickinson

Rob Charles is a partner at Womble Bond Dickinson (US) LLP and a leader of the firm’s Bankruptcy and Creditors’ Rights Practice Group, practicing throughout Arizona and Nevada. He represents secured and unsecured creditors, as well as debtors, across business bankruptcy cases, commercial litigation, and business transactions, guiding clients through complex Chapter 11 issues in all aspects of debtor/creditor relationships, workouts, and litigation.

• Education & Credentials

Rob is a Fellow of the American College of Bankruptcy and teaches business reorganization in bankruptcy at the University of Arizona James E. Rogers College of Law as a Professor of Practice and Adjunct Professor.

• Recognition & Leadership

Rob received the Best Lawyers “Lawyer of the Year” award in Arizona for Bankruptcy, Creditor/Debtor Rights Law, and Bankruptcy Litigation, Insolvency and Reorganization Law across 2005–2025. He has been named a Benchmark Litigation “Local Litigation Star” in Arizona from 2014–2025, a Southwest Super Lawyers honoree in Business Bankruptcy, and one of the Top 50 lawyers in Arizona in multiple years. He was named to The Lawdragon 500 Leading Bankruptcy & Restructuring Lawyers in 2020, holds an AV Preeminent rating, and received the John P. Frank Pro Bono Award for his commitment to pro bono service.

• Professional Involvement

Rob has served as a Fellow of the American College of Bankruptcy since 2007 and as a member of its Board of Directors since 2020. He is a past chair of the State Bar of Arizona Bankruptcy Section, a member of the American Bar Association’s Business Bankruptcy Committee, the American Bankruptcy Institute, and the Pima County Bar Association. He served on the Conference Executive Committee of the Ninth Circuit Judicial Conference from 2011–2015 and as a Lawyer Representative for the United States District Court for the District of Arizona from 2008–2011.

• Experience

Rob regularly represents creditors in Nevada, Arizona, and other bankruptcy courts in administrative cases, adversary proceedings, and appeals, and periodically represents debtors and creditors’ committees in all facets of bankruptcy court and appellate jurisdiction. His representative matters include a technology company’s Delaware Chapter 11 case resulting in plan confirmation and an asset sale within one year, equipment lienholders in a southern Arizona hospital Chapter 11, a regional health care chain’s acquisition of an Arizona hospital via Chapter 11 plan, and agricultural and national lenders in loan enforcement and related litigation. He also advises on Uniform Commercial Code matters, including negotiable instruments, banking law, and secured transactions.

SESSION 1 – Answering the Preference Demand Letter: Elements, Defenses, and Settlement Valuation | 1:00pm – 2:00pm

This session equips attorneys to evaluate and respond to preference demand letters issued by bankruptcy liquidating trusts, covering the statutory elements of a preference claim under 11 U.S.C. § 547, the primary affirmative defenses available to recipients, and the practical mechanics of settlement valuation. Attendees will learn how the SBRA’s 2019 due diligence amendment creates new dismissal opportunities, how updated dollar thresholds affect claim viability, and how to construct a documented defense letter that positions the client for favorable settlement. Attorneys will leave with a repeatable framework for triaging demand letters, identifying the strongest available defenses, and negotiating from a position of documented strength.

BREAK | 2:00pm – 2:10pm

SESSION 2 – Challenging the Trust: Standing Defects, Retained-Claims Failures, and Fraudulent Transfer Defenses | 2:10pm – 3:10pm

Liquidating trusts increasingly pursue trade creditors, vendors, and lenders on fraudulent transfer theories, often assuming the defendant will pay rather than fight. This session gives defense counsel the threshold and merits-level arguments that can end or narrow those actions before the parties reach discovery. Attendees will learn to test whether a confirmed plan and disclosure statement actually preserved the specific claim the trust now asserts under § 1123(b)(3)(B), and how that analysis shifts between the strict Seventh Circuit specificity rule and more permissive jurisdictions where the confirmation order controls. The session then works through constitutional and jurisdictional vulnerabilities, including Stern challenges to final adjudication of state-law claims and the standing and due process questions that arise when avoidance actions are sold to a creditor rather than retained by a trust. It closes with the core fraudulent transfer defenses: the § 546(e) safe harbor after Petr and Holliday, § 548(c) good faith and value with the Fifth Circuit netting rule, reasonably equivalent value, earmarking, and the statute of limitations. Attendees leave with a structured, checklist-driven framework for evaluating any trust demand before engaging on the merits.