Delaware Court 'Champions' Per Se Rule for Constructive Fraudulent Transfers

In re Champion Enterprises Inc., the U.S. Bankruptcy Court for the District of Delaware dismissed, inter alia, portions of the creditors’ committee’s complaint against the pre-petition lenders that alleged that transfers of certain cash, collateral and other rights were constructive fraudulent transfers. In doing so, Hon. Kevin Gross applied a “per se test”: A payment made or collateral granted on account of valid third-party antecedent
debt, while potentially preferential, is per se not a fraudulent transfer.