In what has aready been a very active case for Adversary Proceedings for recovery of bankruptcy preferences, the plan trustee for 99 Cent Stuff, Inc. filed 13 more banrkuptcy preference actions this week, including 7 today.
On January 24, 2007, 99 Cent Stuff, Inc. filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Florida, Case No. 07-10474. 5. On October 24, 2007, the Bankruptcy Court entered and Order confirming the Debtor’s First Amended Plan of Reorganization (the “Plan”). Pursuant to the Plan, Francis L. Carter was appointed as Plan Trustee with the power and authority to pursue, among other things, actions to avoid and recover preferential transfers made by the Debtor.
With the statute of limitations running out in about 15 days, the trustee is going to be cleaning out all the hold outs in the negotiation process.
Suppliers to retailers are frequently the targets of bankruptcy preference actions. Once more, for those suppliers who had thought the matter was over, the case illustrates that preference actions are like lingering time bombs. The plan of reorganization was approved well over a year ago. The case was filed almost 2 years ago. Needless to say, suppliers should never assume that time is a friend when it comes to preference actions.