Ninth Circuit Insulates Corporate Insider from Preference Liability

“A corporate insider who personally guaranteed” the debtor’s loan was not liable on a bankruptcy trustee’s preference claim when the corporate debtor repaid its lender, held the U.S. Court of Appeals for the Ninth Circuit on May 6, 2015. In re AdamsonApparel, Inc., 2015 WL 2081575 (9th Cir. May 6, 2015) (2-1). In this article, SRZ partner Michael L. Cook discusses the Ninth Circuit’s decision, which affirmed the dismissal of the trustee's claim by the bankruptcy court and the district court.