The 2008 Ply-Marts’ bankruptcy case (ND Ga. Case #08-72687) provides a poster-child picture of how trade creditors can lose when an involuntary bankruptcy petition is filed against a financially-strapped customer. In addition to the recovery of pre-petition preferential transfers under Section 547 of the Bankruptcy Code, many of the 45 adversary proceedings filed by the Chapter 7 trustee between August 16 and August 30, 2010, are introducing the defendants to the rights of a trustee to seek recovery under Section 549 on account of payments made to a creditor after an involuntary petition is filed and before the bankruptcy judge orders the commencement of the bankruptcy.
On August 16, 2010, the Chapter 7 bankruptcy trustee for Ply-Marts, Inc. (Northern District of Georgia Bankruptcy Case No. 08-72687) sued twenty creditors of the defunct lumber and building materials retailer, which did business as “Ply-Mart” and “PlyMart” (the “Debtor”). The trustee, Tamara Miles Ogier of the Atlanta firm of Ellenberg, Ogier, Rothschild & Rosenfeld, is seeking to avoid and recover preferential transfers made by the Debtor within the 90-day preference period.