Creditor Rights: Bankruptcy: Preference Claims

Clients are almost always shocked by the fact that the bankruptcy law allows bankrupt debtors to recover payments made to a creditor (called "preference payments"), without any offset against the bankrupt's debt to the creditor. This can occur even though the creditor is prevented from continuing its collection activities against the debtor.

Fox, O'Neill & Shannon, S.C.'s creditor's rights attorneys are experts in defending against preference claim actions filed on behalf of a bankrupt debtor. When faced with a preference claim or action, the attorneys engage in a detailed analysis of the client's historical transactions with the debtor, including payments from, invoices to, and products/services provided to the debtor, an analysis of the creditor client's and debtor's industries, and the substance and timing of the precise payments at issue.

FOS has had great success in defending preference claims and obtaining the most favorable possible results for their creditor clients. In doing so, the creditor's rights attorneys view a preference issue as one part of the larger bankruptcy proceedings, and consider the impact of a claim's resolution on other bankruptcy rights and obligations of the client.