The King is Dead. Long Live the King.
A Primer to the Shift in the Federal Pleading Standard from Conley’s “No Set of
Facts” Test to the Twombyl/Iqbal “Plausibility” Test and
its Impact on Bankruptcy Litigation1
Rafael X. Zahralddin2 and Shelley Kinsella3
These materials are a brief primer on the new pleading standards for federal cases
following Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), and Ashcroft v. Iqbal,
129 S.Ct. 1937 (2009), and their application to bankruptcy avoidance actions. Following
the summaries of the main pleading standard cases (including decisions in the Caremerica
bankruptcy) is a select list of recent cases applying the new pleading standard by various
bankruptcy courts.
I.
The Pleading Standard Under the Federal Rules of Civil Procedure
The standard of pleading in federal cases has long been governed by Federal
Rules of Civil Procedures (the “Federal Rules”) 8 and 9. Rule 8 provides for the general
pleading standard: “a short and plain statement … showing that the pleader is entitled to
relief.” Rule 9 provides for the heightened pleading standard for “special matters”
including fraud (“In alleging fraud … a party must state with particularity the
circumstances constituting fraud”) FED. R. CIV. P. 8(b), 9(b).
II.
The Conley Standard: “No Set of Facts” Test
Under Conley, it was well settled law that: “In appraising the sufficiency of the
complaint we follow, of course, the accepted rule that a complaint should not be
dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can
prove no set of facts in support of his claim which would entitle him to relief.” Conley v.
Gibson, 355 U.S. 41, 45-46 (1957) (emphasis added). Furthermore, under Conley, “the
Federal Rules of Civil Procedure do not require a claimant to set out in detail the facts
upon which he bases his claim. To the contrary, all the Rules require is “‘a short and
plain statement of the claim’ that will give the defendant fair notice of what the
plaintiff’s claim is and the grounds upon which it rests.” Id. at 47 (emphasis added).
Plainly stated, this was a very plaintiff-friendly standard. The hurdle faced by
defendants seeking to dismiss a complaint was high. Plaintiffs, with any set of facts to
support their claim, no matter how implausible, could proceed with their cases. More
importantly, they were free to impose discovery on the defendant, which would be costly
and could be potentially burdensome.
1
Special thanks to Shana Pinter and Phil Giordano of Elliott Greenleaf for their research and editing of
these materials.
2
Managing Shareholder, Elliott Greenleaf Wilmington, Delaware.
3
Counsel, Elliott Greenleaf Wilmington, Delaware.
III.
Twombly/Iqbal: The “New” Plausibility Standard
The recent Supreme Court cases of Twombly and Iqbal, were significant
departures from the Conley standard and changed the manner in which federal complaints
are analyzed for sufficiency.
In place of Conley’s standard, the Supreme Court has adopted a heightened
standard which requires plaintiffs to plead claims that are "plausible," and not merely
"conceivable." Twombly, 550 U.S. at 561-63. Conley’s “no set of facts” test “earned its
retirement” because too many courts had allowed “wholly conclusory statement[s] of
claim” to survive “whenever the pleadings left open the possibility that a plaintiff might
later establish some ‘set of [undisclosed] facts’ to support recovery.” Id.
Twombly and Iqbal, taken together, create a new “plausibility” test. The first step
of the new test questions the factual sufficiency of a complaint and then analyzes its legal
sufficiency. The "no set of facts" test of Conley only tested the legal sufficiency of a
complaint by requiring that "a complaint should not be dismissed for failure to state a
claim unless it appears beyond a doubt that the plaintiff can prove no set of facts in
support of his claim." Conley, 355 U.S. at 45.
Under Twombly, the Supreme Court further interpreted Federal Rule 8 as
requiring “enough factual matter … to suggest … plausible grounds [for the basis of
claim upon which relief can be granted].” Twombly, 550 U.S. at 556 (emphasis added).
Factual allegations now must be sufficient to raise a plaintiff's right to relief above
speculation. The new standard of plausibility is supported by Rule 8’s requirement that
“the ‘plain statement’ possess enough heft to ‘sho[w] that the pleader is entitled to
relief.’” Id. at 557 (internal citation omitted).
The Court further bolstered its new plausibility standard by directly clarifying the
“no set of facts” language of Conley: “this … language can be read in isolation as saying
that any statement revealing the theory of the claim will suffice unless its factual
impossibility may be shown from the face of the pleadings.” Id. at 561 (emphasis
added). The Court was careful to state that this new plausibility standard “does not
impose a probability requirement at the pleading stage; it simply calls for enough fact to
raise a reasonable expectation that discovery will reveal evidence of [the basis of the
stated claim].” Id. at 556 (emphasis added).
This paradigm shift in sufficiency analysis of federal complaints was further
reaffirmed by the Court in Iqbal, published earlier this year. In the interim period
between Twombly and Iqbal, there was speculation that Twombly should be construed
narrowly and was limited to only antitrust cases (the underlying dispute in Twombly was
an antitrust matter). Iqbal confirmed that the Court intended Twombly to be a sea change
from the Conley standard and meant to apply to all civil cases. Iqbal, _____ U.S. _____,
129 S.Ct. at 1953.
Iqbal requires courts to perform a new fact-screening function at the motion to
dismiss stage. “A claim has facial plausibility when the plaintiff pleads factual content
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that allows the court to draw the reasonable inference that the defendant is liable for
the misconduct alleged.” Iqbal, _____ U.S. _____, 129 S.Ct. at 1949 (citing Twombly,
550 U.S. at 556) (emphasis added). The Court further expounded upon Twombly and
clarified the following two points:
(1) courts must only accept as true factual allegations but not legal conclusions; and
(2) determining whether a complaint is plausible is a “context-specific task that
requires the reviewing court to draw on its judicial experience and common sense.”
Iqbal, _____ U.S. _____, 129 S.Ct 1949-50 (internal citation omitted). An inference of
only the “mere possibility of misconduct” in a complaint will not survive a motion to
dismiss. Id. at 1950.
There are, however, several unanswered questions left open by the Supreme
Court. The Court did not address:
(1) the threshold of plausibility a complaint must possess to survive a motion to
dismiss;
(2) the sources of information a court may rely on to substantiate its “judicial
experience and common sense” (Id.); and
(3) whether discovery is allowed at the beginning of a case before a motion to dismiss
is decided.
The new rule has had an effect on cases in the federal district courts, though there
is some analysis that shows the greatest impact might be on certain types of cases, such
as civil rights cases. Kendall W. Hannon, Much Ado About Twombly? A Study on the
Impact of Bell Atlantic Corp. v. Twombly on 12(B)(6) Motions, 83 NOTRE DAME L. REV.
1811 (2008). In addition, Professor Patricia Hatamyar has reviewed 1039 reported and
unreported federal district court cases deciding motions to dismiss and found that when
courts apply the Twombly/Iqbal standard, courts are 1.5% more likely to grant a motion
to dismiss than under Conley. Patricia W. Hatamyar, The Tao of Pleading: Do Twombly
and Iqbal Matter Empirically?, 59 AM. U. L. REV. (forthcoming 2010), available at
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1487764. See also, Has the Supreme
Court Limited Americans’ Access to Courts? Hearing Before the Subcomm. on the
Judiciary, 111th Cong. (2009) (statement of Stephen B. Burbank, Professor, University
of Pennsylvania Law School), available at http://judiciary.senate.gov/pdf/12-0209%20Burbank%20Testimony.pdf.
These two cases have also the caught the attention of Congress. The Notice
Pleading Restoration Act of 2009, S. 1504, 111th Cong. (2009) and its House companion,
the Open Access to Courts Act, H.R. 4115, 111th Cong. (2009), are recent legislative
attempts to repeal the plausability standard and reinstate notice pleading under Conley.
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IV.
Twombly/Iqbal and Bankruptcy
The new pleading standard enunciated in Twombly and Iqbal control complaints
filed in bankruptcy courts as well, including avoidance actions in adversary proceedings.
as Federal Rules of Civil Procedure 8 and 9 are made applicable to bankruptcy
proceedings under Federal Rules of Bankruptcy Procedure 7008 and 7009.
A recent series of decisions in the Caremerica bankruptcy has put avoidance
actions to the Twombly/Iqbal test: Angell v. BER Care Inc., 409 B.R. 737 (Bankr.
E.D.N.C. 2009) (“Caremerica I”); Angell v. BER Care Inc., 409 B.R. 246 (E.D.N.C.
2009) (“Caremerica II”); and Angell v. BER Care Inc., 2009 WL 2253225 (Bankr.
E.D.N.C. July 28, 2009) (“Caremerica III”) and makes clear that the heightened pleading
standard is applicable to complaints filed in bankruptcy cases as well.
A. Caremerica I
Caremerica I involved an action for recovery of preferential and fraudulent
transfers pursuant to Sections 547 and 548 of title 11 of the United States Code, 11
U.S.C. et seq. (the “Bankruptcy Code”), made by the debtors to a company owned by two
of the debtors’ shareholders/officers and subsequently transferred to other defendants in
an apparent attempt to avoid attachment by creditors. The company, BER Care, Inc.,
formerly known as PPS, Inc., shareholders and officers of the debtor as well as principal
owners of BER Care, Inc., were named as defendants. On September 15, 2008, after
Caremerica’s bankruptcy was converted to chapter 7, the chapter 7 trustee commenced an
adversary proceeding to avoid and recover alleged preferential and fraudulent transfers
made by the debtors to BER Care, Inc., and then subsequently transferred to the
defendants. Id.
The original complaint contained a listing of the total amount of the alleged
preferential and fraudulent transfers received by the defendants and stated whether each
defendant was an insider or non-insider. Id. The complaint was subsequently amended
twice to include, respectively, a bank statement for February 2006 listing PPS, Inc., as the
account holder, and an exhibit detailing each alleged transfer by amount, date, check
number, payee reference number, payee names, account numbers and names
corresponding to each transfer (“Exhibit B”). Id. The defendants filed 12(b)(6) motions,
arguing that the preference and fraudulent counts were insufficiently pleaded. Judge J.
Rich Leonard granted the motion as to the preferential transfer and Bankruptcy Code
Section 548(a)(1)(B) constructive fraud counts and denied the motion as to the
Bankruptcy Code Section 548(a)(1)(A) actual fraud counts.
In Caremerica I, II, and III the trustee was given leave to amend his complaint in
order to re-plead and address the lack of detail and specificity required by the heightened
pleading standard.
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a. Preferential Transfer Counts
Judge Leonard dismissed the preferential transfer counts on the grounds that,
under the new Twombly/Iqbal plausibility standard, the trustee had failed to sufficiently
plead factual support for the four out of the five elements of such actions:
i. Transfer of an interest of the debtor in property
Since both the bank statement in the name of PPS/BER and Exhibit B failed to
show the source of the funds, the court held that the trustee had failed to sufficiently
plead factual support to “give rise to a reasonable inference” that the funds transferred
originated from the debtor. Id. at 751.
ii. For or on Account of an Antecedent Debt
The Court found that, the chapter 7 trustee’s near recitation of the language of
section 547(b)(2) of the Bankruptcy Code is fatal to the preferential transfer count.
“Facts supporting the existence of an antecedent debt owed by the debtors to the
defendants” are necessary and that the chapter 7 trustee is “obligated to allege facts
regarding the nature and amount of the antecedent debt.” Id.
iii. Made While the Debtor was Insolvent
As to this element, because the chapter 7 trustee was attempting to avoid and
recover alleged preferential transfers outside of the 90-day preference period and was
alleging that the defendants were insiders, there were two issues at play: (1) whether the
transfers occurred between 90 days and one year prior to the petition date; and (2)
whether the defendants were insiders. Id. at 752. The court did find sufficient factual
support that the transfers occurred in the preference period based upon the information
contained in Exhibit B. Moreover, the court held that “labeling the transferees as insiders
is not enough to establish a reasonable inference of insider status” and that “details
regarding the relationship between the debtors and the defendants” are necessary in order
to determine such status. Id. at 753.
iv. Enabled Creditor to Receive More than it Would Under
Chapter 7
Finally, the court found unconvincing the chapter 7 trustee’s argument that the
adoption of the heightened pleading standard of Twombly/Iqbal placed an undue burden
upon the plaintiff. Essentially, the court held that since the antitrust plaintiffs in Twombly
and the Pakastani detainee in Iqbal were held to the new plausibility standard, so too shall
bankruptcy trustees, who are in a much more favorable position, having access to the
books and records of the debtors and full discovery powers in the years leading up to the
commencement of such adversary proceedings. Id. at 754.
The only element that the court did find was sufficiently pled in the preferential
transfer count was that of the alleged transfer being “to or for the benefit of the creditor,”
reasoning that the inclusion of “the names of transferees and the dates and amounts of
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each transfer” in Exhibit B was sufficient factual support to pass Twombly/Iqbal. Id. at
751.
b. Fraudulent Transfer Counts
Continuing to the fraudulent transfer claims, Judge Leonard dismissed the
constructive fraud count. However, the court allowed the actual fraud to survive without
reference to Twombly/Iqbal, but solely on the grounds that the particularity pleading
requirement of Rule 9(b) was met by: (1) the assertion that the transfers were completed
after the debtor had received notice from the IRS of its intent to levy and garnish its
accounts; and (2) the inclusion of the detailed information in Exhibit B. Id. at 755.
As to the constructive fraud count, the court applied the Twombly/Iqbal test since
this count only need to adhere to the general pleading requirements of Rule 8(b). Under
the new plausibility standard, Judge Leonard dismissed this count because it failed to
include “an identification of the consideration received by each transferor, information as
to why the value of such consideration was less than the amount transferred, and facts
supporting the debtors’ insolvency at the time of the transfer.” Id. at 756.
B. Caremerica II and III
The court applied the same analytical framework to Caremerica II and III,
dismissing the chapter 7 trustee’s complaints in their entirety.
a. Caremerica II
Caremerica II also involved shareholders and officers of the debtors as
defendants. The trustee brought an adversary proceeding to avoid and recover allegedly
preferential transfers of “at least $7,438.39” and fraudulent transfers of “at least
$8,369.91.” Caremerica II, 409 B.R. at 349. However, the complaints failed to include
any information as to the date, amount, origination, or recipient of the transfers or the
nature and amount of any antecedent debt owed by the debtor to the recipients. Id. at
350-52.
i. Preferential Transfer Count
The court dismissed the preferential transfer claim as to all elements (except that
the transfer enabled the creditor to receive more than it would under chapter 7 which the
Court found was satisfied through the debtors’ summary of schedules) on the grounds
that the failure to include any information as to the date, amount, recipient or origination
of the transfers and the nature and amount of the antecedent debt was fatal to the trustee’s
case since failing to do so left the claim with no factual support as to the elements of a
preference action.
ii. Fraudulent Transfer Count
The court also dismissed the fraudulent transfer count under both actual fraud and
constructive fraud theories:
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a. Actual Fraud
As announced in Caremerica I, the court applied the heightened pleading standard
of Rule 9(b) and found the chapter 7 trustee’s complaint insufficient due to the lack of
any allegation of fraudulent conduct on behalf of the defendant transferees. Id. at 353.
b. Constructive Fraud
Likewise, the court dismissed the fraudulent transfer count based on the theory of
constructive fraud because the chapter 7 trustee failed to include any factual support
“describing the consideration received by each transferor or the debtors’ insolvency at the
time of the transfer.” Id. at 354.
b. Caremerica III
This case closely mirrors the facts and outcome of Caremerica II, with two
notable exceptions: (1) some of the alleged transferees were not shareholders or officers
of the debtors themselves, but a relative of those insider defendants, therefore removing
the presumption of insider status grounded in “the level of control and involvement
characteristic of insiders under Bankruptcy Code Section 101(31);” and (2) the alleged
preferential transfer occurred within the one-year period prior to the petition date, rather
than the 90-day preference period. Caremerica III, 2009 WL 2253225, at *1, *4 (Bankr.
E.D.N.C.).
The trustee brought adversary proceeding to avoid and recover alleged
preferential transfers of “at least $42,750.00” and fraudulent transfers of “at least
$62,750.00.” In following the analysis of Caremerica II & III, and citing Twombly/Iqbal,
the court dismissed all counts because the trustee failed to allege sufficient factual
support regarding: (1) the origination of the transfers due to the fact that multiple
defendants share very similar names which are not utilized in the complaint; (2) the
nature and amount of the antecedent debt; (3) the insolvency of the debtor at the time of
the transfers; (4) the fraudulent conduct; and (5) the consideration received by the
transferees.
i. Preferential Transfer Count
Again, as in Caremerica II, the preferential transfer count was dismissed by the
court, on the basis that the failure to include: (1) the date, amount, origination, and
recipient of the transfers was fatal to the elements of (i) whether there was a transfer of an
interest of the debtor in property, and (ii) whether the transfer was to or for the benefit of
a creditor; and (2) factual support as to the “nature and amount of the antecedent debt”
was fatal to that element. Id. at *2 -3. Specific to this case, because the alleged
preferential transfers occurred within the one-year period prior to the petition date and
not during the 90-day preference period, the chapter 7 trustee was not entitled to the
presumption of insolvency. Id. at *3. As such, the lack of factual support as to the
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insolvency of the debtor at the time the alleged transfer was made was fatal to that
element. Finally, the allegation that the transfers were made to alleged insiders was
insufficient because there was no factual support describing the control or level of
involvement by the defendants. Id. at *4.
ii. Fraudulent Transfer Count
The court dismissed the fraudulent transfer counts on both theories of actual and
constructive fraud for the same reasons cited above in Caremerica II.
C. Other Caremerica Rulings
Below are several other, less publicized, Caremerica cases. Each applied the
Twombly/Iqbal standards to the defendant’s motion to dismiss the trustee’s complaint.
a. Angell v. Etheridge (In re Caremerica, Inc.), 2009 WL 2253232 (Bankr.
E.D.N.C.)
The trustee brought an adversary proceeding to avoid and recover alleged
preferential transfers and fraudulent transfers, both of “at least $10,323.06.” In following
the analysis of Caremerica II & III, and citing Twombly/Iqbal, the court dismissed all
counts because the trustee failed to allege sufficient factual support regarding: (1) the
origination of the transfers; (2) any information relating to the date, amount, or recipient
of the transfers; (3) the nature and amount of the antecedent debt; (4) the insolvency of
the debtor at the time of the transfers; (5) whether the transferees received more as a
result of the transfers than it would receive in a Chapter 7 liquidation; (6) the fraudulent
conduct; and (7) the consideration received by the transferees.
b. Angell v. First Eastern, LLC (In re Caremerica, Inc.), 2009 WL
2253241 (Bankr. E.D.N.C.)
The trustee filed an adversary proceeding seeking to avoid and recover alleged
preferential transfers of $389K and fraudulent transfers, on the alternative theories of
actual and constructive fraud, of an unknown amount, both of which represented rent
paid by the debtors. In following the analysis of Caremerica II & III, and citing
Twombly/Iqbal, the court dismissed all counts because the trustee failed to allege
sufficient factual support regarding: (1) the origination of the transfers due to the fact
that multiple defendants share very similar names which are not utilized in the complaint;
(2) the nature and amount of the antecedent debt; (3) the insolvency of the debtor at the
time of the transfers; (4) the fraudulent conduct; and (5) the consideration received by the
transferees.
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c. Angell v. First Eastern, LLC (In re Caremerica, Inc.), 2010 WL 428059
(Bankr. E.D.N.C.)
Following the dismissal of his complaint by the court in Angell v. First Eastern,
LLC (In re Caremerica, Inc.), Adv. No. L-08-00157-8-JRL, 2010 WL 2253241 (Bankr.
E.D.N.C.), trustee filed an amended complaint seeking to avoid and recover alleged
preferential transfers of $389K and fraudulent transfers, on the alternative theories of
actual and constructive fraud, of an unknown amount, both of which represented rent
paid by the debtors. Citing the new plausibility standards of Twombly/Iqbal, defendant’s
motion to dismiss as to actual fraud was granted because the complaint failed to allege
any facts in support of that theory. As to the alternative pleading of constructive fraud,
the court denied the motion to dismiss because of the uncertainty of the relationship
between the defendant and landlord, which would be developed during discovery.
Likewise, the preference action was not dismissed because sufficient factual support was
alleged which would “render plausible” the possibility that the transfers were made on
account of antecedent debt owed to the debtor.
d. Angell v. Rose Hill Enterprises, LLC, (In re Caremerica, Inc.), 2010 WL
358524 (Bankr. E.D.N.C.)
Following the dismissal of his complaint by the court in Caremerica I, the trustee
filed an amended complaint which attempted to address the deficiencies cited by the
court in that opinion. Three of the five counts were again dismissed under
Twombly/Iqbal because of the trustee’s failure to allege sufficient factual support relating
to: (1) property rights; and (2) the existence of an antecedent debt.
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Selected List of Bankruptcy Cases Applying the Plausibility Standard4
This is not an exhaustive list of recent cases; it is only illustrative.
January 27, 2010
Walker v. Pasteur (In re Aphton Corporation), 423 B.R. 76 (Bankr. D. Del 2010)
The Complaint contained six counts where a Chapter 11 trustee brought an
adversary proceeding to avoid certain transfers that debtor had made prepetition, in
connection with its redemption of a debenture sold to a pharmaceutical company that had
joined with debtor in co-promoting a new drug to fight cancer and through payment to its
former noteholders.
Counts I through III set forth constructive fraudulent conveyance claims against
the pharmaceutical company, Aventis. Counts V through VII set forth constructive
fraudulent conveyance claims against the former noteholders. Aventis and the former
noteholders argued that the Complaint failed to state a claim upon which relief could be
granted.
Counts I and V of the Complaint filed by the Trustee asserted that the Trustee was
a lien creditor pursuant to § 544(b) of the Bankruptcy Code and that the $3 million
transferred to a pharmaceutical company by the debtors to jointly promote a new drug
and the $3 million transferred to the debtors former noteholders were each fraudulent
transfers under the "Pennsylvania and/or Delaware Uniform Fraudulent Transfer Act.
The defendants asserted that the Counts I and V of the Complaint were deficiently
pled because they did not identify the elements of a claim under state law or even refer to
the purportedly applicable statutory provisions related to a claim of a fraudulent transfer.
The Court held that the Trustee did not recite the elements of either Pennsylvania or
Delaware’s Uniform Fraudulent Transfer Act, nor did he allege the specific facts that
meet those elements. Hence, the Court, applying Twombly and Iqbal, dismissed Counts I
and V.
Counts II and VI of the Complaint asserted fraudulent conveyance claims
pursuant to § 548 of the Bankruptcy Code. Both counts asserted that (i) the transfers were
made within two years of the petition date; (ii) the Debtor received less than reasonably
equivalent value for the transfer; and (iii) the transfers occurred at a time when the
Debtor was insolvent. The Court then found that the allegations in Count II and VI of the
Complaint were contradicted by the documents attached and incorporated therein. The
Complaint did not assert when the Redemption Payment was made or how the two
transactions were related. Therefore, the Court found that the document controlled and
the Court did not need to accept as true the allegations of the Complaint. Moreover, the
Court held that the Complaint lacked sufficient factual allegations to determine which
4
Special thanks to Phil Giordano and Jessi Adkins for their research and editing of the case summaries.
10
transactions were less than reasonably equivalent value. Counts III and VII of the
Complaint sought recovery of each of the alleged fraudulent transfers pursuant to § 550
of the Bankruptcy Code.
The Court granted the defendant’s motion to dismiss and dismissed Counts I, II,
III, and V of the Complaint. The Court denied in part the former noteholders’ motion to
dismiss Counts VI and VII of the Complaint allowing part of the fraudulent conveyance
claims to survive.
January 29, 2010
The Official Comm. of Unsecured Creditors of Midway Games Inc. v. National
Amusements Inc. (In re Midway Games Inc., et al.), 428 B.R. 303 (Bankr. D. Del. 2010)
Committee brought adversary proceeding to avoid and recover alleged
preferential and fraudulent transfers to: (1) Independent Directors for their fees; and (2)
87.2% equity owners of the debtor, referred to as the “Redstone Defendants,” who sold
such interest to a third-party, prior to the debtor entering bankruptcy. Citing the new
plausibility standards of Twombly and Iqbal, defendant’s motion to dismiss as to the
fraudulent transfer counts against the Directors were granted on the grounds that the
Committee failed to allege factual support: (1) as to whether the fees paid to the
Independent Directors were extraordinary; and (2) as to whether the Independent
Directors were liable for any wrongdoing. Likewise, the fraudulent counts against the
Redstone Defendants were also dismissed on the grounds that the Committee failed to
allege factual support as to: (1) any of the “badges of fraud” required by the court; and
(2) the value received in exchange for the sale of the defendants’ equity interest in debtor.
The preferences counts were decided on grounds unrelated to Twombly and Iqbal.
February 19, 2010
Zucker v. Freeman (In re Netbank, Inc.), 424 B.R. 568 (Bankr. M.D. Fla. 2010)
Zucker, as the Liquidating Supervisor of the debtor, filed an adversary complaint
seeking to avoid a transfer from debtor to the defendant, pursuant to an employment
agreement. Following Twombly and Iqbal, the Court held that the date on which the
transfer took place must be within the 90 day period, and the Complaint must allege that
it took place on an exact date, and not on or about a date. The plaintiff’s failure to
specify the date warranted a dismissal of the Complaint. The Court’s order to dismiss the
complaint was without prejudice.
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March 11, 2010
Boston v. Chrysler Financial Services Americas LLC (In re Scott), 427 B.R. 123 (Bankr.
S.D. Ind. 2010)
Chrysler filed a motion to dismiss and in support of the motion, offered material
outside of the pleading, which the Court than deemed to be a motion for summary
judgment. Chrysler raised three arguments: (i) the case should be dismissed because the
Trustee failed to name an indispensable party by not naming the Trust as a defendant; (ii)
that the vehicle was no longer property of the estate; and (iii) that the premise of the their
claims is incorrect because the basis for their claim is that the lien in unperfected. Given
the importance of the substantive issue presented, the Court chose to bypass the first two
arguments raised by Chrysler in favor of a ruling solely on the merits of the Trustee’s
Complaint. Thus, the determinative question was whether the Trust’s lien on the Vehicle
was perfected under Indiana law. Concluding that the vehicle was perfected, the Court
granted Chrysler’s motion for summary judgment and therefore chose to forego a
discussion of the Complaint’s sufficiency under Twombly and Iqbal.
April 16, 2010
Feltman v. KeyBank, N.A. (In re Levitt and Sons, LLC, et al.), 2010 WL 1539878 (Bankr.
S.D. Fla.)
Feltman, the Plan Administrator, filed a complaint against KeyBank, which
attempted to avoid and recover allegedly preferential and fraudulent transfers on behalf of
the Debtors. The Complaint alleged that by the time of the Petition Date, a number of the
Debtors had become jointly and severally liable, through guaranties and related loan and
security documents, for the obligations of the other Debtors. The complaint did not
specify the extent of the total loan amounts, nature of the underlying obligations, which
entities were obligated, or which entities were the source of the funds allegedly paid to
KeyBank. Using the Twombly and Iqbal standards, the Court held that the evidence did
not indicate the source of the funds that entered the related entities’ accounts, or which
specific entity initiated each transfer. The Court thus dismissed the complaint because it
possessed an insufficient factual basis to meet the Twombly standard for stating a claim
for relief. The Court also dismissed the complaint without prejudice.
April 20, 2010
Official Committee of Unsecured Creditors of Hydrogen, L.L.C. v. Blomen (In re
Hydrogen, L.L.C.), 2010 WL 1609536 (Bankr. S.D. N.Y.)
The Creditors Committee brought several actions against defendant, one of which
was fraudulent transfer regarding bonuses received by defendants. The defendants’ filed
a motion to dismiss and the Court, applying the Twombly and Iqbal standards, ordered to
dismiss the fraudulent transfer claim because the complaint did little more than “a
formalistic recitation of the elements,” and did not include facts supporting the allegation.
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The Committee also alleged that the Defendants received substantial transfers as
preferences, but the Court dismissed this claim because it contained few relevant facts,
which, again, only amounted to a “formalistic recitation of the elements.”
April 24, 2010
Wahoski v. Classic Packaging Co. (In re Pillowtex Corporation), 427 B.R. 301 (Bankr.
D. Del. 2010)
Wahoski, the Liquidating Trustee, brought an adversary proceeding to avoid and
recover alleged preferential and fraudulent transfers. Citing the plausibility standards of
Twombly and Iqbal, defendant’s motion to dismiss as to the fraudulent transfer count was
granted on the grounds that the trustee failed to allege any factual support of the fraud,
and was just merely reciting the statutory language of § 548 (a). The motion was also
dismissed without prejudice, allowing the Liquidating Trustee to respond with the
adequate facts to support a fraudulent transfer claim.
June 9, 2010
Butler v. Anderson (In re C.R. Stone Concrete Contractors, Inc.), 2010 WL 2404198
(Bankr. D. Mass.)
The estate filed several complaints alleging preferences, fraudulent conveyances
and seeking turnover of the Debtors’ assets which were consolidated into one action
when the case converted to a chapter 7. The Court did not dismiss the Debtor’s
preference action under Fed. R. Civ. P. 12(b)(6). Disagreeing with Valley Media Inc. v.
Borders, Inc. (In re Valley Media, Inc.), 288 B.R. 189 (Bankr. D. Del. 2003) the Court
rejected a heightened pleading standard. The Court applied the Iqbal standards and
determined that the complaint did not need detailed factual allegations. The Court
seemed to selectively apply a passage in Iqbal, while ignoring the new plausibility
standard: “’In Ashcroft v. Iqbal, the Supreme Court stated that ‘’the pleading standard
Rule 8 announces does not require 'detailed factual allegations,' but it demands more than
an unadorned, the-defendant-unlawfully-harmed-me accusation.’" Id. at *10. The Court
found that the omnibus complaint satisfied the liberal pleading standard even with a
finding that the allegation lacked specificity with regard to the preference claim
June 18, 2010
Springel v. Hotel Plaza Athenee (In re Innovative Communication Corp.), 2010 WL
3069489 (Bankr. W.D. Pa.)
Springel’s complaint asserted that the transfers of Debtor’s funds to defendant
were made without board approval. The Court, applying Twombly, ruled that the
complaint contained adequate well pled facts, when accepted as true, of intent to hinder,
delay, and defraud creditors, to support a claim for avoidance and recovery of fraudulent
transfers. The Court continued to explain that the complaint did not provide factual
13
allegations to support Count 6, which sought to avoid and recover post-petition transfers.
They further stated that Exhibit A to the complaint listed the check dates of each transfer
the plaintiff sought to avoid and recover, and that the most recent date among the checks
listed was June 22, 2007. The bankruptcy case was filed on July 5, 2007. Therefore, on
the face of the complaint, it was not apparent that any transfer was made post-petition.
With respect to Count 7, the Court ruled that the plaintiff failed to sufficiently plead that
the transfers identified on Exhibit A were “made while the debtor was insolvent.” Only
two of the eleven payments identified on Exhibit A fell within the applicable 90 day
period. Therefore, to the extent plaintiff intended to avoid the remaining nine payments
as preferential transfers, he had failed to sufficiently plead facts to establish how these
payments qualify. The motions were dismissed without prejudice.
July 14, 2010
Charys Liquidating Trust v. Hades Advisors, LLC (In re Charys Holding Co..) 2010 WL
2788152 (Bankr. D. Del.)
Charys Liquidating Trust filed a preference action against Hades Advisors, LLC,
and also sought avoidance of transferred monies on constructive fraudulent transfer
theories. The Liquidating Trust alleged that shortly before the Debtor filed for Chapter
11, the Debtor’s CEO retained Hades Advisors, LLC without Board authorization, and
that the $100,000 transfer between the Debtor and Hades was fraudulent. Applying Iqbal
and Twombly, the Court dismissed the first count regarding the preference action because
the “complaint contained no facts from which the Court could infer that that Transfer was
made on account of antecedent debt.” On the other hand, the Court refused to dismiss
Count II, III, and IV, because the Plaintiffs had adequately alleged that the Transfers
were made within the statutory period and at a time when the Debtors were insolvent.
The Counts that were dismissed were dismissed without prejudice.
July 27, 2010
The Liquidation Trust v. Daimler AG (In re Old Carco LLC, et al.), 2010 WL 2925997
(Bankr. S.D. N.Y.)
A liquidation trust filed an adversary proceeding alleging fraudulent transfers
against the Debtors’ former 100% equity owner on the grounds that it orchestrated a
scheme to strip away valuable assets. Citing the new plausibility standards of Twombly
and Iqbal, the action was dismissed on the grounds that the complaint failed to
sufficiently plead: (1) each element of value received; (2) lack of fair consideration; and
(3) bad faith on behalf of transferee bondholders. The motions were dismissed without
prejudice.
14
Heightened Pleading Standards Under Twombly and Iqbal: Special Concerns for
Preference Litigation
Written by:
Joseph L. Steinfeld, Jr.
ASK Financial, LLP; St. Paul, MN
[email protected]
In Bell Atlantic v. Twombly, 550 U.S. 544, 563, 127 S.Ct. 1955, 1969 (2007), the Supreme
Court, determining that the Conley v. Gibson standard on pleading sufficiency had “earned its
retirement” after “puzzling the profession for 50 years,” announced a new pleading standard
required to survive a motion to dismiss. Rule 8(a)(2) of the Federal Rules requires only “a short and
plain statement of the claim showing that the pleader is entitled to relief.” Id. at 555, 1965. Under
Conley v. Gibson, surviving motions to dismiss required that a complaint give “‘the defendant fair
notice of what the ... claim is and the grounds upon which is rests.’” Id. (quoting Conley v. Gibson,
355 U.S.41, 47, 78 S.Ct. 99, (1957). Under the Conley standard, a “‘complaint should not be
dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no
set of facts in support of his claim which would entitle him to relief.’” Id. at 561. (quoting 355 U.S.
at 45-46, 78 S.Ct. 99).
In announcing the new pleading requirements, the Court stated that while factual allegations
need not be detailed, they require more than “labels and conclusions, and a formulaic recitation of
the elements of a cause of action.” Id. at 555, 1964-65. Instead, factual allegations must be
sufficient to raise a right to relief beyond mere speculation. Id. at 555, 1965. The Court replaced
the traditional pleading standard under Conley with requirement that complaint must state “enough
factual matter” to make the claim “plausible.” Twombly, 127 S.Ct. 1965. The Court indicated that
the plausibility requirement does not impose probability requirement on claims, but only called for
enough fact to raise expectation that discovery will reveal evidence of the claim. Id. at 556, 1965.
In Ashcroft v. Iqbal, 129 S.Ct. 1937 (2009), the Court made clear the new pleading standard
applied beyond the scope of the antitrust issues examined in Twombly, stating that in order to
survive a motion to dismiss in any case “a complaint must contain sufficient factual matter, accepted
as true, to ‘state a claim for relief that is plausible on its face.’” Id. at 1949 (citing Twombly at 570,
1955). The Court emphasized that two principles underlie the Twombly decision: first, in motion
to dismiss, the requirement that court must accept all allegations as true does not apply to legal
conclusions, only factual allegations. Id. at 1949. Second, only complaints stating plausible claims
for relief can survive motions to dismiss. Id. at 1950.
A.
Heightened Pleading Standard in Adversary Proceedings:
The effect of Twombly and Iqbal on adversary proceedings cannot be ignored. The
Bankruptcy Court for the Eastern District of North Carolina examined the heightened pleading
standards in several adversary proceedings in the Camerica bankruptcy case. The heightened
pleading standard has now been applied in avoidance actions in the Southern District of New York,
the District of Delaware, and the Eastern District of Pennsylvania. A summary of cases both
denying and granting motions to dismiss in avoidance actions are listed below. It should be noted
that while the Caremerica cases listed infra mainly deal with preference avoidance under §547 and
fraudulent transfers under § 548, several of the other cases listed are multiple-count claims involving
complicated issues in addition to preference avoidance. Dismissal of the preference claims in the
other cases may revolve around the strength of the plaintiff’s overall case or lack thereof.
1.
Cases Granting Motions to Dismiss
The Caremerica Cases
•
In Angell v. BER Care Inc. (In re Caremerica Inc.), 409 B.R. 737, 745 (Bankr. E.D.N.C.
2009) (“Caremerica I”), the defendants made motions to dismiss the trustee’s claims of
preferential and fraudulent transfers for failure to state a claim under Fed. R. Civ. P.
12(b)(6). The court went through each element of the preference claim, and found that the
trustee had failed to allege facts with requisite specificity on the elements of an avoidable
preference under § 547(b). The trustee alleged that the debtors had transferred funds through
BER Care as a conduit, and the funds were then distributed to other defendants. Id. at 750.
Although the debtor attached the bank statements of BER Care to demonstrate transfers from
the conduit to the defendant, the court determined that the trustee failed to show the transfers
were of the debtor’s property. Id. at 750-51. Additionally, the court found that the assertion
that each transfer was made “for, or on account of, an antecedent debt owed by the
Transferor to the Defendant before the transfer was made” was a conclusory assertion that
failed to identify specific antecedent debt to satisfy plausibility requirements. Id. at 751.
Although insolvency is presumed for the 90 days preceding filing, for transfers made
between 90 days and one year prior to filing, a trustee must allege sufficient facts to show
insolvency. Id. at 752. The trustee’s assertion stating the debtor was insolvent when making
the transfers, without factual assertions in support thereof, fell short of the plausibility
requirement for transfers between one year and within 90 days. Id. Nor was the trustee’s
recitation that the defendants were insiders as described in §101(31) and 547(b), without
supporting facts, sufficient for plausibility. Id. at 753.
•
The Caremerica I court also examined the trustee’s claims alleging constructive and actual
fraud. Id. at 754. Although the allegation of actual fraud survived the heightened pleading
requirements of Fed. R. Civ. P. 9(b), the constructive fraud claim did not survive general
pleading requirements, as it did not contain alleged facts as to why the value of the
consideration received was less than of that transferred, nor did it contain facts on
insolvency. Id. at 755-56. It is worth noting that although the motion to dismiss was granted,
the trustee was granted permission to amend his complaint to include factual support, and
the court deemed that the amendment related back to the date of pleading. Id. at 757.
•
In Angell v. Haveri (In re Caremerica Inc.), 409 B.R. 346, 351-52 (Bankr. E.D.N.C. 2009)
(“Caremerica II”), the court also found the complaint insufficient in alleging that the
defendant was a transferor, that there was specific antecedent debt, and that the transfers
occurred within the 90 days preceding filing. The court also found the trustee’s actual fraud
claim lacked particularity required under Rule 9(b), as it failed to described the conduct
2
constituting fraud. Id. at 353. The trustee’s constructive claim failed plausibility, as it failed
to factually describe the consideration received by each transfer or the debtor’s insolvency
at the time. Id. at 354. Despite the motion to dismiss, the court granted leave for the trustee
to re-plead his claims against the defendant within 30 days of the order consistent with the
order in Caremerica I. 409 B.R. at 354.
•
Additional Caremerica cases follow the Angell v. BER Care, Inc. analysis when examining
the sufficiency of the pleadings:
•
Angell v. Burrell (In re Caremerica Inc.),409 B.R. 759 (Bankr. E.D.N.C. 2009)
(“Caremerica III”) (determining complaint was insufficient for preference claim
where trustee failed to identify which of the debtors made transfer, failed to support
assertion payments benefitted a creditor, did not allege specific antecedent debt;
fraudulent transfer claims both for actual and constructive fraud were also
insufficient).
•
Angell v. Day (In re Caremerica Inc.), 415 B.R. 200 (Bankr. E.D.N.C. 2009)
(“Caremerica IV”) (adopting reasoning in Angell v. BER Care, Inc. when
determining complaint failed to identify the actual antecedent debt, failed to allege
the dates of the transfer, did not include a basis for labeling the defendants insiders;
constructively fraudulent transfer claims dismissed as well for failing to identify
consideration received or why the value of consideration was less than the amount
transferred).
•
Angell v. First Eastern (In re Caremerica Inc.),2009 WL 2253241 (Bankr. E.D.N.C.
July 29, 2009) ( “Caremerica V”) ( incorporating Angell v. BER Care, Inc. analysis
and determining complaint was insufficient as to the preference count because it was
unclear which one of the debtors made the payment, the complaint failed to identify
the antecedent debt, there were insufficiently pled facts for insolvency outside of the
90 day preference period, and it contained no facts concerning insider status;
constructive and fraudulent transfers insufficient as well).
•
Angell v. Etheridge (In re Caremerica Inc.), 2009 WL 2253232 (Bankr. E.D.N.C.
July 29, 2009) ( “Caremerica VI”) (incorporating Angell v. BER Care, Inc. analysis
in granting motions to dismiss for preference claim as complaint failed to identify
which one of the debtors made the transfer, contained no facts in support of assertion
that defendants were transferees, failed to state dates, amounts, and numbers of
transfers, and failed to identify the actual antecedent debt; fraudulent transfer also
claim insufficient as it fails to describe the fraudulent conduct alleged, and
constructive fraud claim failed to identify consideration received or why the value
of consideration was less than the amount transferred).
•
Angell v. Burrell, Cannon (In re Caremerica Inc.), 2009 WL (Bankr. E.D.N.C. July
28, 2009) ( “Caremerica VII”) (incorporating Angell v. BER Care, Inc. analysis in
granting motions to dismiss for preference claim as complaint failed to identify the
dates or amounts of each alleged transfer or which debtor made the transfers, failed
to identify the antecedent debt, insufficiently pled facts for insolvency outside of the
90 day preference period, and failed to plead facts sufficient to alleged that certain
defendants had a relationship sufficient to constitute insiders; fraudulent transfer also
3
claim insufficient as it fails to describe the fraudulent conduct alleged, and
constructive fraud claim failed to identify consideration received or why the value
of consideration was less than the amount transferred).
Other Avoidance Actions Granting Motions to Dismiss
•
Charys Liquidating Trust and C&B Liquidating Trust v. Hades Advisors, LLC (In re Charys
Holding Co., Inc. And Crochet & Borel Services, Inc.), Slip. Op. 2010 WL 2788152, *1
(Bankr. D. Del. July 14, 2010), involved a financial advising group hired by the debtor’s
outgoing CEO shortly before filing. The plaintiff alleged that the outgoing CEO employed
the advising group without the knowledge or authority of the board of directors. Id. at *2.
The court determined that the plaintiff’s complaint insufficiently alleged all elements of the
preference claim. The complaint did adequately identify the preferential transfer by date,
transferor/tranferee, and amount. Id. at *5. However, the Court found that complaint did
not allege sufficient facts as to antecedent debt. Id. Although the complaint identified that
the defendant had been retained prior to the transfer, the complaint did not specifically allege
that the services were rendered prior to the transfer date. Id. The preference count was
dismissed without prejudice. Id. As to the constructive fraud claim, the court determined that
based on the facts alleged in the complaint, which included details about the hiring of the
defendant by an employee of the debtors unauthorized to do so shortly before the bankruptcy
filing, the claim survived the motion to dismiss. Id. at *7.
•
In Official Committee of Unsecured Creditors of Hydrogen, LLC v. Blomen (In re
Hydrogen), – B.R.–, 2010 WL 1609536 (Bankr. S.D.N.Y. April 20, 2010), both a preference
claim and a constructive fraud claim failed to survive a motion to dismiss. As to
constructive fraud, the court determined there was a complete lack of facts supporting the
allegations and the complaint set forth “little more than a ‘formulaic recitation of elements.’”
Id. at *10 (internal citations omitted). As to the preference claim, the complaint alleged the
defendant received preferential transfers under 11 U.S.C. §547, but other than one specified
transfer, the complaint failed to identify other allegedly preferential payments by amount,
date, type of transfer, or the invoices the transfer paid, making it impossible to identify any
other specific transfer. Id. at *12. Despite the deficiencies in the complaint, the plaintiff was
granted leave to replead all dismissed claims except for one claim unrelated to the preference
or constructive fraud counts. Id. at *18.
•
In Wahoski v. Classic Packaging Co. (In re Pillowtex Corp.), 427 B.R 301 (Bankr. D.Del.
2010), the defendant made a motion to dismiss count two of the complaint, which alleged
constructively fraudulent transfers pursuant to 11 U.S.C. §548. Id. at 304. Although the
plaintiff contended that the fraud claim needed to be preserved as an alternative claim, the
court found the constructive fraud claim failed to meet Twombly pleading requirements
where there was a complete lack of factual allegations and the complaint merely recited
statutory language. Id. at 311. The court then analyzed the possibility of amendment, and
recited the normal rule that a court must give a plaintiff leave to amend a complaint that fails
to state a claim, unless such amendment should be futile. Id. The court noted that the
4
“bare-boned drafting” of the second count did not appear motivated by bad faith or an intent
to delay, and although the transaction appeared to be at arm’s length, to ensure an adequate
opportunity to respond, the trustee was given leave to file an amended complaint within
fourteen days setting forth adequate facts to support the claim. Id. at 311-12.
•
In Walker v. Sonafi Pasteur (In re Aphton Corp.), 423 B.R. 76 (Bankr. D. Del. 2010), the
court held the trustee’s claims as a lien creditor under § 544 and one of the fraud claims
under § 548 and were insufficiently pled. Although the court recognized that a trustee is
generally afforded greater liberality in pleading fraud, it still noted that Rule 9(b) required
the trustee do more than merely identify the allegedly fraudulent transfers. Id. at 85. The
trustee’s allegations under § 544 were insufficient, as they merely pled that the trustee was
a lien creditor, and failed to identify the elements of a claim under state law or allege
specific facts meeting the elements. Id. at 87. The court dismissed one of the claims under
§548 for failing to allege sufficient facts to make a plausible claim the transaction was less
than reasonably equivalent value. Id. at 91. The second count of constructive fraud survived
the motion where the facts alleged were facially plausible. Id. at 93.
•
In The Official Committee of Unsecured Creditors of Midway Games Inc. v. National
Amusements, Inc. (In re Midway Games, Inc.), 428 B.R. 303, 311 (Bankr. D.Del. 2010), the
plaintiff filed a twenty-two count complaint alleging actual fraud and constructive fraud
under § 544 and § 548, preferential transfers, breach of fiduciary duties, aiding and abetting
breach of fiduciary duties, and equitable subrogation. The court determined that the plaintiff
sufficiently plead facts to establish the debtor’s insolvency, an essential element to all of the
avoidance claims. Id. at 321. The facts alleging the debtor’s insolvency during the time
periods at issue were deemed sufficient, as the complaint stated facts concerning the debtor’s
losses, failure to pay debts as they came due, and fact that debtor’s liabilities far exceeded
its assets. Id. However, the plaintiff did not make sufficient factual allegations of actual
fraud against the defendants, as the complaint failed to allege secrecy or reservation of
benefits. Id. at 325. Nor did the constructive fraud survive the motion to dismiss, as the
complaint lacked sufficient facts alleging the debtors received less than reasonably
equivalent value in exchange for fees paid. Id.
•
Feldman v. Chase Home Finance (In re Image Masters, Inc.), 421 B.R. 164 (Bankr. E.D.Pa.
2009) is a somewhat unusual case, as it involved the trustee attempting to recover funds for
debtors that were involved in a large home mortgage Ponzi scheme from defendants that
were innocent as to the Ponzi scheme. For the constructive fraud claims, the facts alleged
under the heightened standard had to sufficiently allege facts showing the debtor received
less than reasonably equivalent value in exchange for payments. Id. at 176-77. The
plaintiff’s complaint and attached exhibits failed to allege facts making a facially plausible
claim that the debtor received less than reasonably equivalent value, and the complaint was
deemed insufficient as containing “‘formulaic recitation of the elements of a cause of
action.’” Id. at 179 (citing Ashcroft, 129 S.Ct. at 1949). Due to the uniqueness of the Ponzi
scheme element, the actual fraud claims, even taking the allegations in the complaint as true,
were dismissed due to the good faith exception of the innocent defendants. Id. at 181. The
5
actual fraud claims were also deemed insufficient under Rule 9(b). Id. at 188.
2.
Cases Denying Motions to Dismiss
•
In Miller v. Greystone Business Credit II, LLC (In re USA Detergents, Inc.), 418 B.R. 533,
541 (Bankr. D.Del. 2009), the trustee survived a motion to dismiss for failure to state a
claim. The defendants made a motion to dismiss the §547 claim on the basis that the
plaintiff had not demonstrated the defendant was a creditor or that it had received more than
it would have under a Chapter 7 liquidation. First, the court concluded that the waiver of the
right to collect by the guarantor-defendant was insufficient to deem the defendant a noncreditor. Id. at 541. Second, the court found the facts alleged by the plaintiff sufficient to
survive a motion to dismiss on the element of 547(b) requiring the creditor to receive more
than it would in liquidation, as the trustee made numerous assertions about the debtor’s
financial problems that raised strong inference creditors received more than they would have
under Chapter 7. Id. at 542.
•
As cited supra, in several Caremerica adversary proceedings the trustee was given leave to
replead claims that were dismissed for failure to meet the increased pleading requirements.
In Angell v. First Eastern, LLC (In re Caremerica, Inc.), 2010 WL 428059 (Bankr. E.D.N.C.
Jan. 5, 2010) (“Caremeria VIII”), the court addresses the sufficiency of the trustee’s
amended pleadings filed after leave was given by the court to amend. Id. at * 1. The court
determined that the amended preference claim rendered plausible the assertion that the
transfers were made on account of antecedent debt, as an exhibit to the complaint detailed
charges assessed and payments made, as well as showed an accumulating arrearage over
time. Id. As to the actual fraud claim under 11 U.S.C. § 548(a)(1)(A), the trustee conceded
that there were no facts to support such a claim, and the motion to dismiss as to actual fraud
was granted. Id. at *2. Concerning the constructive fraud claim, the trustee contended that
it was pled in the alternative to the § 547 claim, and that the relationship between the debtors
and defendant that created a question as to whether the defendant gave consideration to the
debtors. Id. Despite the trustee having insufficient information as to why the defendant was
receiving rent and whether the debtors received anything of value, the court determined that
the issue was sufficiently pled and that the facts developed during discovery would establish
which one of the trustee’s alternative claims could be pursued. Id.
B.
Blunting the Impact: Motions to Amend that Relate Back. Under Fed. R. Civ.
P. 15(c)
Despite the new factual specificity required in pleading, courts may grant plaintiffs leave
to amend complaint and allow the amendment to relate back to the date of filing. Under Federal
Rule of Civil Procedure 15(a), and party may amend once as a matter of course :
(B) if the pleading is one to which a responsive pleading is required,
21 days after service of a responsive pleading or 21 days after service
of a motion under Rule 12(b), (e), or (f), whichever is earlier.
6
Fed. R. Civ. P. 15(a)(1)(B).
Under Rule 15(c), an amendment relates back to the date of the original pleading when:
(A) the law that provides the applicable statute of limitations allows
relation back;
(B) the amendment asserts a claim or defense that arose out of the
conduct, transaction, or occurrence set out — or attempted to be set
out — in the original pleading; or
(C) the amendment changes the party or the naming of the party
against whom a claim is asserted, if Rule 15(c)(1)(B) is satisfied and
if, within the period provided by Rule 4(m) for serving the summons
and complaint, the party to be brought in by amendment:
(i) received such notice of the action that it will not be
prejudiced in defending on the merits; and
(ii) knew or should have known that the action would have
been brought against it, but for a mistake concerning the proper
party's identity.
Fed. R. Civ. P. 15(c)(1).
In Caremerica I, the trustee was granted permission to amend his complaint to include
factual support, and the court deemed that the amendment related back to the date of pleading. 409
B.R. at 757. The court disagreed with the defendants’ assertions that a failure to state a claim
precluded amending complaints after the statute of limitations had run, stating that relation back is
not contingent on the original complaint satisfying the Rule 8(a)(2) pleading standard. Id at 757.
Plaintiff’s counsel in a preference action, given sometimes less than fully complete
information concerning the allegedly preferential transactions on tight deadlines, may have to amend
a complaint after a motion to dismiss in order to avoid dismissal. The Comments to the recent
amendments to the Federal Rules of Civil Procedure for Rule 15 indicate that the new 21-day time
limit to amend as a matter of course after a motion under Rule 12 was designed to allow the pleader
to address the concerns raised in the motion and potentially avoid the need for the motion be decided
by the court:
This provision will force the pleader to consider carefully and promptly the wisdom
of amending to meet the arguments in the motion. A responsive amendment may
avoid the need to decide the motion or reduce the number of issues to be decided,
7
and will expedite determination of issues that otherwise might be raised seriatim.
Report of the Advisory Committee on Civil Rules, Comments to Rule 15, p. 288
(http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/Supreme%20Court%202008/ST
09-2008.pdf).
A motion to dismiss that alleges the complaint fails to state a claim upon which relief may be
granted can be countered by amending the complaint to supplement the allegedly insufficient
pleadings, addressing the concerns in a way that avoids the need to decide the motion as the
Comments contemplated.
If the plaintiff has missed the 21-day deadline, Rule 15 indicates that if a party cannot
amend as a matter of course, leave to amend should be freely granted when justice requires. Fed.
R. Civ. P. 15(a)(2). Caselaw indicates that liberal leave to amend is favored. Although the decision
to grant or deny a motion to amend is within the discretion of the court, “outright refusal to grant
the leave without any justifying reason appearing for the denial is not an exercise of discretion; it
is merely abuse of that discretion and inconsistent with the spirit of the Federal Rules.” Foman v.
Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 230 (1962). Only when equitable factors suggest
amendment would be unjust should leave to amend be denied. Arthur v. Maersk, Inc., 434 F.3d 196,
203 (3d Cir. 2006). At least in the Third Circuit, courts have applied a liberal approach to
amendment, to ensure that a claim may be heard on the merits rather than on technicalities. Dole v.
Arco Chemical Co., 921 F.2d 484, 487 (3d Cir. 1990).
Motions to amend that meet the requirements of Federal Rule of Civil Procedure 15(c) are
deemed to relate back to the date of the original pleading. A plaintiff merely adding factual details
to the same claims asserted in the original, allegedly deficient complaint has a strong argument that
under 15(c)(1)(B), the amendment asserts a claim or defense arising from the conduct, transaction,
or occurrence set out in the original pleading, therefore qualifying for relation back. Although the
new heightened pleading standard may create a more burdensome process for plaintiffs in adversary
proceedings, a motion to dismiss should not be fatal to a party with the information and exhibits
necessary to amend a complaint to create a facially plausible complaint that relates back to the date
of the original filing.
C.
Strengthening the Initial Complaint to Avoid Twombly and Iqbal Concerns
Often in avoidance actions the plaintiff is a Chapter 7 trustee or litigation trustee, and is in
a different position in terms of first-hand knowledge of the facts comprising the complaint.
However, after Twombly and Iqbal, trustees must take care to ensure that avoidance action
complaints contain facts sufficient to make out plausible preference claims. The following nonexhaustive list contains issues identified in the cases cited supra that counsel should consider when
filing a complaint:
• In a jointly administered case, is the debtor that actually paid each transfer identified?
8
• Is each transfer identified by check number or identified as a wire? Is the check date and
clear date listed?
• Is the actual antecedent debt identified? In many cases the invoice number and invoice
date can provide this information. In other cases other documents may have to be
identified to connect the transfer to antecedent debt.
• In addition to referencing the presumption of insolvency, is there other information on
insolvency that may be included?
• When alleging that the transfers allowed the defendant to receive more than it would
have under a Chapter 7 liquidation, are there schedules and proofs of claims that
can be referenced that can provide support for this element?
A plaintiff’s attorney would be wise to strengthen their avoidance action complaints pro-actively
so as to avoid motions to dismiss after the fact.
9
UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE
In re
Bk. No. 08-11787-BLS
(Jointly Administered)
Ascendia Brands, Inc., et al.1,
Debtors.
Ascendia Brands, Inc., et al., Debtors in
Possession,
Chapter 11
Adv. No. Refer to Summons
Plaintiff,
vs.
A-1 Label Inc.,
Defendant.
COMPLAINT TO AVOID TRANSFERS
PURSUANT TO 11 U.S.C. §§ 547, 548, 549AND 502 AND TO RECOVER
PROPERTY TRANSFERRED PURSUANT TO 11 U.S.C. § 550
Ascendia Brands, Inc., and certain of its direct and indirect affiliates and subsidiaries, the
debtors and the debtors-in-possession in the above cases (collectively, the "Plaintiff"), by its
undersigned attorneys, in support of this complaint (the "Complaint") to avoid and recover
transfers against A-1 Label Inc. (the "Defendant"), hereby alleges upon information and belief
that:
NATURE OF THE CASE
1
The Debtors in these cases, along with the last four digits of each Debtor's federal tax identification number, are: Ascendia
Brands, Inc. (8820); Hermes Acquisition Company 1 LLC (2347); Ascendia Brands Co., Inc. (4604); Lander Co., Inc. (2447);
Lander Intangibles Corporation (8789); and Ascendia Real Estate LLC (2435). The mailing address for each of the Debtors is
P.O. Box 450, Penns Park, PA 18943.
10
1.
This Complaint seeks to avoid and recover from Defendant, or from any other
person or entity for whose benefit the transfers were made, all preferential transfers of property
made for or on account of an antecedent debt and to or for the benefit of Defendant by Ascendia
Brands, Inc., et al. (the "Debtors") during the ninety-day (90) period prior to the filing of the
Debtors' bankruptcy petitions pursuant to 11 U.S.C. §§ 547 and 550. Subject to proof, the
Complaint also seeks to recover pursuant to 11 U.S.C. § 549 any transfers on account of prepetition debt that cleared post-petition and pursuant to 11 U.S.C. § 548 any transfers that may
have been a fraudulent conveyance. To the extent that Defendant has filed a proof of claim or
has a claim listed on the Debtors' schedules as undisputed, liquidated, and not contingent, or has
otherwise requested payment from the Debtors' or the Debtors' chapter 11 estates, (collectively,
the "Claims"), this Complaint is not intended to be, nor should it be construed as, a waiver of
Plaintiff's right to object to such Claims for any reason including, but not limited to, 11 U.S.C. §
502 (a) through (j) ("Section 502"), and such rights are expressly reserved. Notwithstanding this
reservation of rights, certain relief pursuant to Section 502 may be sought by Plaintiff herein as
further stated below.
JURISDICTION
2.
This Court has subject matter jurisdiction over this adversary proceeding, which
arises under Title 11, arises in, and relates to cases under Title 11, in the United States
Bankruptcy Court for the District of Delaware, Case No. 08-11787, pursuant to 28 U.S.C. §§ 157
and 1334(b).
3.
The claims and causes of action set forth herein concern the determination,
allowance, disallowance, and amount of claims under 11 U.S.C. §§ 502, 547, 548, 549 and 550.
11
This adversary proceeding is a "core" proceeding to be heard and determined by the Bankruptcy
Court pursuant to 28 U.S.C. § 157(b)(2).
4.
Venue is proper in the District of Delaware pursuant to 28 U.S.C. § 1408.
BACKGROUND
5.
These bankruptcy cases were commenced by the filing on August 5, 2008 (the
"Petition Date") of voluntary petitions for relief under Chapter 11 of title 11 of the United States
Code by the Debtors. Plaintiff is authorized to commence suit on behalf of the Debtors' chapter
11 estates.
6.
Plaintiff is informed and believes and on that basis alleges that Defendant is a
business entity whose legal structure is presently unknown.
CLAIMS FOR RELIEF
COUNT 1
(Avoidance of Preference Transfers - 11 U.S.C. § 547)
7.
Plaintiff incorporates all preceding paragraphs as if fully re-alleged herein.
8.
On or within ninety (90) days before the Petition Date, that is between May 7,
2008 and August 5, 2008 (the "Preference Period"), the Debtors continued to operate their
business affairs, including the transfer of property, either by checks, cashier checks, wire
transfers, direct deposit or otherwise to certain entities, including Defendant.
9.
Plaintiff has completed an analysis of all readily available information of the
Debtors and is seeking to avoid all the transfers of an interest of the Debtors' property made by
one or more of the Debtors to Defendant within the Preference Period.
10.
Plaintiff has determined that one or more of the Debtors made transfers to
12
Defendant during the Preference Period in an amount not less than $436,642.22 (the
"Transfers"). Attached hereto as "Exhibit A" and incorporated herein by this reference is a list
identifying each known Transfer that Plaintiff seeks to avoid and recover in this Complaint.
11.
During the course of this proceeding, Plaintiff may learn (through discovery or
otherwise) of additional transfers made to Defendant during the Preference Period. It is
Plaintiff's intention to avoid and recover all transfers made by one or more of the Debtors of an
interest of the Debtors in property and to or for the benefit of Defendant or any other transferee.
Plaintiff reserves its right to amend this original Complaint to include: (i) further information
regarding the Transfers, (ii) additional Transfers, (iii) modifications of and/or revision to
Defendant's name, (iv) additional defendants, and/or (v) additional causes of action (e.g., but not
exclusively, 11 U.S.C. § 542, § 544, § 545, § 548 and § 549) (collectively, the "Amendments"),
that may become known to Plaintiff at any time during this adversary proceeding, through formal
discovery or otherwise, and for the Amendments to relate back to this original Complaint.
12.
Defendant was a creditor of the one or more of the Debtors at the time of the
Transfers within the meaning of 11 U.S.C. § 101(10)(A). At the time of the Transfers,
Defendant had a right to payment on account of an obligation owed to Defendant by one or more
of the Debtors. See "Exhibit A" attached hereto and incorporated herein by this reference, which
also identified each known invoice or debt owed to Defendant by one or more of the Debtors and
paid by the Transfers sought to be avoided and recovered in this Complaint.
13.
The Transfers were to or for the benefit of a creditor within the meaning of 11
U.S.C. § 547(b)(1) because the Transfers either reduced or fully satisfied a debt then owed by
one or more of the Debtors to Defendant. Id.
13
14.
The Transfers were for, or on account of, antecedent debts owed by one or more
of the Debtors before the Transfers were made. Id.
15.
The Debtors were insolvent at all times during the ninety (90) days prior to the
Petition Date. Plaintiff is entitled to the presumption of insolvency for the Transfers made
during the Preference Period pursuant to 11 U.S.C. § 547(f).
16.
As a result of the Transfers, Defendant received more than it would have received
if: (i) the Debtors' cases were under chapter 7 of the Bankruptcy Code; (ii) the Transfers had not
been made; and (iii) Defendant received payment of its debts under the provisions of the
Bankruptcy Code. As evidenced by the Debtors' schedules filed in the underlying bankruptcy
case as well as the proofs of claim that have been received to date, the Debtors' liabilities exceed
their assets to the point that unsecured creditors will not receive a full payout of their claims
from the Debtors' bankruptcy estate.
17.
In accordance with the foregoing, the Transfers are avoidable pursuant to 11
U.S.C. § 547(b).
COUNT II
(To Avoid Fraudulent Conveyances Pursuant to 11 U.S.C. § 548(a)(1)(B))
18.
Plaintiff incorporates all preceding paragraphs as if fully re-alleged herein.
19.
Subject to proof, Plaintiff pleads in the alternative that to the extent one or more
of the Transfers were not on account of an antecedent debt or a prepayment for goods
subsequently received, one or more of the Debtors did not receive reasonably equivalent value in
exchange for such transfer(s) (the "Potentially Fraudulent Transfers"); and
A.
One or more of the Debtors were insolvent on the date that the Transfer(s)
14
was made or became insolvent as a result of the Transfer(s); or
B.
One or more of the Debtors were engaged in business or a transaction, or
was about to engage in business or a transaction, for which any property
remaining with one or more of the Debtors was an unreasonably small
capital; or
C.
One or more of the Debtors intended to incur, or believed that one or more
of the Debtors would incur, debts that would be beyond one or more of the
Debtors' ability to pay as such debts matured.
20.
The Potentially Fraudulent Transfers are avoidable pursuant to 11 U.S.C. §
548(a)(1)(B).
COUNT III
(To Recover Unauthorized Post Petition Transfers Pursuant to 11 U.S.C. § 549)
21.
Plaintiff incorporates all preceding paragraphs as if fully re-alleged herein.
22.
Subject to proof, Plaintiff pleads in the alternative that to the extent one or more
of Debtors made a transfer to Defendant on account of obligations that arose before the Petition
Date and that cleared after the Petition Date, such transfer(s) were unauthorized post-petition
transfers (the "Post Petition Transfers") and are avoidable under 11 U.S.C. § 549.
COUNT IV
(Recovery of Avoided Transfers - 11 U.S.C. § 550)
23.
Plaintiff incorporates all preceding paragraphs as if fully re-alleged herein.
24.
Plaintiff is entitled to avoid the Transfers pursuant to 11 U.S.C. § 547(b), any
Potentially Fraudulent Transfers pursuant to 11 U.S.C. § 548, and any Post Petition Transfers
15
under 11 U.S.C. § 549. The Transfers, any Potentially Fraudulent Transfers and any Post
Petition Transfers are collectively referred to herein as "All Avoided Transfers."
25.
Defendant was the initial transferee of the All Avoided Transfers or the
immediate or mediate transferee of such initial transferee or the person for whose benefit All
Avoided Transfers were made.
26.
Pursuant to 11 U.S.C. § 550(a), Plaintiff is entitled to recover from Defendant All
Avoided Transfers, plus interest thereon to the date of payment and the costs of this action.
COUNT V
(Disallowance of all Claims - 11 U.S.C. § 502(d) and (j))
27.
Plaintiff incorporates all preceding paragraphs as if fully re-alleged herein.
28.
Defendant is an entity from which property is recoverable under 11 U.S.C. § 550.
29.
Defendant is a transferee of All Avoided Transfers avoidable under 11 U.S.C. §§
547, 548 and/or 549.
30.
Defendant has not paid the amount of the All Avoided Transfers, or turned over
such property, for which Defendant is liable under 11 U.S.C. § 550.
31.
Pursuant to 11 U.S.C. § 502(d), any and all Claims of Defendant and/or its
assignee, against the Debtors' chapter 11 estates or Plaintiff must be disallowed until such time
as Defendant pays to Plaintiff an amount equal to the aggregate amount of All Avoided
Transfers, plus interest thereon and costs.
32.
Pursuant to 11 U.S.C. § 502(j), any and all Claims of Defendant, and/or its
assignee, against the Debtors' chapter 11 estates or Plaintiff previously allowed by the Debtors or
Plaintiff, must be reconsidered and disallowed until such time as Defendant pays to Plaintiff an
16
amount equal to the aggregate amount of all the All Avoided Transfers.
PRAYER FOR RELIEF
WHEREFORE, Plaintiff requests that this Court grant it the following relief against
Defendant:
As to Counts I through V, that the Court enter a judgment against Defendant:
A.
That All Avoided Transfers avoidable under 11 U.S.C. §§ 547, 548 and/or 549 in
the amount of $436,642.22 be avoided;
B.
That All Avoided Transfers, to the extent that they are avoided pursuant to 11
U.S.C. §§ 547, 548 and/or 549, be recovered by Plaintiff pursuant to 11 U.S.C. §
550;
C.
Disallowing, in accordance with 11 U.S.C. § 502 (d), any Claims held by
Defendant and/or its assignee until Defendant satisfies the judgment;
D.
Disallowing, in accordance with 11 U.S.C. § 502 (j), any Claims held by
Defendant and/or its assignee until Defendant satisfies the judgment;
E.
Awarding pre-judgment interest at the maximum legal rate running from the date
of each Transfer to the date of judgment herein;
F.
Awarding post judgment interest at the maximum legal rate running from the date
of judgment herein until the date the judgment is paid in full, plus costs;
G.
Requiring Defendant to pay forthwith the judgment amount awarded in favor of
Plaintiff ;
H.
Granting Plaintiff such other and further relief as the Court deems just and proper.
17
Dated: July 28, 2010
By
Local Counsel
/s/
[LOCAL COUNSEL]
and
Primary Counsel
(Please Contact Primary Counsel)
Joseph L. Steinfeld, Jr., DC SBN 297101,
MN SBN 0266292, VA SBN 18666
Gary D. Underdahl, MN SBN 0301693
AASAK FINANCIAL LLP
2600 Eagan Woods Drive, Suite 400
St. Paul, MN 55121
Telephone: (651) 406-9665 ext. 857 Fax: (651) 406-9676
E-Mail: [email protected]
Attorneys For Plaintiff, Ascendia Brands, Inc., et al.,
Debtors in Possession
18
Insolvency Financial & Collection Legal Services
16150 Hartsook Street
Encino, CA 91436
PHONE: 818/609-9268
FAX: 818/609-9686
2600 Eagan Woods Drive, Suite 400
St. Paul, MN 55121
PHONE: 651/406-9665
FAX: 651/406-9676
Los Angeles
Minneapolis
TRANSFERS DURING PREFERENCE PERIOD
Defendant:
A-1 Label Inc.
Bankruptcy Case: Ascendia Brands, Inc., et al.
Preference Period: May 7, 2008 - August 5, 2008
Debtor Entity/
Check No.
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Check Amount
Clear Date
Inv No.
Inv Date
Inv Amt (US Dollars)
$34,142.96
May 15, 2008
062278
March 4, 2008
$3,349.50
$34,142.96
May 15, 2008
062279
March 4, 2008
$4,233.77
$34,142.96
May 15, 2008
062293
March 6, 2008
$415.62
$34,142.96
May 15, 2008
062295
March 6, 2008
$285.00
$34,142.96
May 15, 2008
062326
March 7, 2008
$2,449.20
$34,142.96
May 15, 2008
062327
March 7, 2008
$522.12
$34,142.96
May 15, 2008
062328
March 7, 2008
$134.40
$34,142.96
May 15, 2008
062329
March 7, 2008
$185.66
$34,142.96
May 15, 2008
062330
March 7, 2008
$296.80
$34,142.96
May 15, 2008
062331
March 7, 2008
$628.10
$34,142.96
May 15, 2008
062332
March 7, 2008
$176.40
$34,142.96
May 15, 2008
062333
March 7, 2008
$260.40
$34,142.96
May 15, 2008
062334
March 7, 2008
$255.17
$34,142.96
May 15, 2008
062335
March 7, 2008
$163.62
$34,142.96
May 15, 2008
062336
March 7, 2008
$1,937.26
$34,142.96
May 15, 2008
062337
March 7, 2008
$954.46
$34,142.96
May 15, 2008
062338
March 7, 2008
$2,073.96
$34,142.96
May 15, 2008
062535
March 11, 2008
$209.55
$34,142.96
May 15, 2008
062536
March 11, 2008
$636.00
$34,142.96
May 15, 2008
062537
March 11, 2008
$165.60
19
Debtor Entity/
Check No.
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63108
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Check Amount
Clear Date
Inv No.
Inv Date
Inv Amt (US Dollars)
$34,142.96
May 15, 2008
062538
March 11, 2008
$602.80
$34,142.96
May 15, 2008
062539
March 11, 2008
$170.40
$34,142.96
May 15, 2008
062540
March 11, 2008
$301.40
$34,142.96
May 15, 2008
062541
March 11, 2008
$170.40
$34,142.96
May 15, 2008
062542
March 11, 2008
$628.10
$34,142.96
May 15, 2008
062543
March 11, 2008
$176.40
$34,142.96
May 15, 2008
062544
March 11, 2008
$314.05
$34,142.96
May 15, 2008
062545
March 11, 2008
$88.20
$34,142.96
May 15, 2008
062546
March 11, 2008
$163.62
$34,142.96
May 15, 2008
062547
March 11, 2008
$155.00
$34,142.96
May 15, 2008
062548
March 11, 2008
$284.00
$34,142.96
May 15, 2008
062549
March 11, 2008
$142.00
$34,142.96
May 15, 2008
063963
April 28, 2008
$3,497.50
$34,142.96
May 15, 2008
063965
April 28, 2008
$1,352.93
$34,142.96
May 15, 2008
063967
April 28, 2008
$1,920.71
$34,142.96
May 15, 2008
063969
April 28, 2008
$347.29
$34,142.96
May 15, 2008
063971
April 28, 2008
$3,011.66
$34,142.96
May 15, 2008
063977
April 29, 2008
$399.78
$34,142.96
May 15, 2008
063978
April 29, 2008
$383.25
$34,142.96
May 15, 2008
063979
April 29, 2008
$700.88
$68,687.42
May 21, 2008
062582
March 13, 2008
$1,294.20
$68,687.42
May 21, 2008
062583
March 13, 2008
$299.13
$68,687.42
May 21, 2008
062584
March 13, 2008
$597.08
$68,687.42
May 21, 2008
062585
March 13, 2008
$268.80
$68,687.42
May 21, 2008
062586
March 13, 2008
$566.40
20
Debtor Entity/
Check No.
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Check Amount
Clear Date
Inv No.
Inv Date
Inv Amt (US Dollars)
$68,687.42
May 21, 2008
062587
March 13, 2008
$134.40
$68,687.42
May 21, 2008
062588
March 13, 2008
$522.12
$68,687.42
May 21, 2008
062589
March 13, 2008
$556.71
$68,687.42
May 21, 2008
062590
March 13, 2008
$556.71
$68,687.42
May 21, 2008
062591
March 13, 2008
$112.23
$68,687.42
May 21, 2008
062592
March 13, 2008
$466.20
$68,687.42
May 21, 2008
062593
March 13, 2008
$290.88
$68,687.42
May 21, 2008
062594
March 13, 2008
$142.00
$68,687.42
May 21, 2008
062595
March 13, 2008
$126.83
$68,687.42
May 21, 2008
062596
March 13, 2008
$616.38
$68,687.42
May 21, 2008
062648
March 17, 2008
$900.60
$68,687.42
May 21, 2008
062649
March 17, 2008
$1,232.56
$68,687.42
May 21, 2008
062650
March 17, 2008
$117.16
$68,687.42
May 21, 2008
062651
March 17, 2008
$431.60
$68,687.42
May 21, 2008
062652
March 17, 2008
$537.60
$68,687.42
May 21, 2008
062653
March 17, 2008
$399.58
$68,687.42
May 21, 2008
062654
March 17, 2008
$932.40
$68,687.42
May 21, 2008
062655
March 17, 2008
$3,136.00
$68,687.42
May 21, 2008
062656
March 17, 2008
$445.20
$68,687.42
May 21, 2008
062657
March 17, 2008
$1,205.76
$68,687.42
May 21, 2008
062658
March 17, 2008
$6,002.64
$68,687.42
May 21, 2008
062659
March 17, 2008
$96.39
$68,687.42
May 21, 2008
062660
March 17, 2008
$96.39
$68,687.42
May 21, 2008
062669
March 18, 2008
$834.90
$68,687.42
May 21, 2008
062670
March 18, 2008
$504.23
21
Debtor Entity/
Check No.
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Check Amount
Clear Date
Inv No.
Inv Date
Inv Amt (US Dollars)
$68,687.42
May 21, 2008
062671
March 18, 2008
$739.80
$68,687.42
May 21, 2008
062672
March 18, 2008
$472.00
$68,687.42
May 21, 2008
062673
March 18, 2008
$268.80
$68,687.42
May 21, 2008
062674
March 18, 2008
$472.00
$68,687.42
May 21, 2008
062675
March 18, 2008
$472.00
$68,687.42
May 21, 2008
062676
March 18, 2008
$197.40
$68,687.42
May 21, 2008
062677
March 18, 2008
$236.00
$68,687.42
May 21, 2008
062678
March 18, 2008
$134.40
$68,687.42
May 21, 2008
062679
March 18, 2008
$522.12
$68,687.42
May 21, 2008
062680
March 18, 2008
$207.90
$68,687.42
May 21, 2008
062681
March 18, 2008
$493.50
$68,687.42
May 21, 2008
062682
March 18, 2008
$201.60
$68,687.42
May 21, 2008
062683
March 18, 2008
$923.92
$68,687.42
May 21, 2008
062684
March 18, 2008
$232.08
$68,687.42
May 21, 2008
062685
March 18, 2008
$2,385.00
$68,687.42
May 21, 2008
062686
March 18, 2008
$662.40
$68,687.42
May 21, 2008
062687
March 18, 2008
$2,561.90
$68,687.42
May 21, 2008
062688
March 18, 2008
$681.60
$68,687.42
May 21, 2008
062689
March 18, 2008
$904.20
$68,687.42
May 21, 2008
062690
March 18, 2008
$1,616.60
$68,687.42
May 21, 2008
062691
March 18, 2008
$681.60
$68,687.42
May 21, 2008
062692
March 18, 2008
$2,041.33
$68,687.42
May 21, 2008
062693
March 18, 2008
$529.20
$68,687.42
May 21, 2008
062694
March 18, 2008
$1,570.25
$68,687.42
May 21, 2008
062695
March 18, 2008
$529.20
22
Debtor Entity/
Check No.
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Check Amount
Clear Date
Inv No.
Inv Date
Inv Amt (US Dollars)
$68,687.42
May 21, 2008
062696
March 18, 2008
$556.71
$68,687.42
May 21, 2008
062697
March 18, 2008
$556.71
$68,687.42
May 21, 2008
062698
March 18, 2008
$490.86
$68,687.42
May 21, 2008
062699
March 18, 2008
$426.00
$68,687.42
May 21, 2008
062700
March 18, 2008
$284.00
$68,687.42
May 21, 2008
062701
March 18, 2008
$253.65
$68,687.42
May 21, 2008
062702
March 18, 2008
$312.09
$68,687.42
May 21, 2008
062703
March 18, 2008
$664.30
$68,687.42
May 21, 2008
062704
March 18, 2008
$776.88
$68,687.42
May 21, 2008
062716
March 19, 2008
$1,193.25
$68,687.42
May 21, 2008
062736
March 20, 2008
$1,089.40
$68,687.42
May 21, 2008
062760
March 24, 2008
$2,073.96
$68,687.42
May 21, 2008
062761
March 24, 2008
$2,462.04
$68,687.42
May 21, 2008
062762
March 24, 2008
$1,528.80
$68,687.42
May 21, 2008
062763
March 24, 2008
$1,197.00
$68,687.42
May 21, 2008
062764
March 24, 2008
$477.23
$68,687.42
May 21, 2008
062765
March 24, 2008
$968.63
$68,687.42
May 21, 2008
062767
March 24, 2008
$3,165.54
$68,687.42
May 21, 2008
062768
March 24, 2008
$1,920.71
$68,687.42
May 21, 2008
062769
March 24, 2008
$347.29
$68,687.42
May 21, 2008
062775
March 24, 2008
$2,449.20
$68,687.42
May 21, 2008
062813
March 25, 2008
$1,318.88
$68,687.42
May 21, 2008
063974
April 29, 2008
$64.30
$68,687.42
May 21, 2008
064153
April 30, 2008
$67.22
$68,687.42
May 21, 2008
064171
May 2, 2008
$68.51
23
Debtor Entity/
Check No.
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63418
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Check Amount
Clear Date
Inv No.
Inv Date
Inv Amt (US Dollars)
$68,687.42
May 21, 2008
064189
May 5, 2008
$68.51
$68,687.42
May 21, 2008
064222
May 6, 2008
$68.51
$68,687.42
May 21, 2008
064243
May 7, 2008
$68.51
$68,687.42
May 21, 2008
064264
May 8, 2008
$608.85
$60,362.62
June 2, 2008
061770A
$60,362.62
June 2, 2008
063049
March 27, 2008
$636.00
$60,362.62
June 2, 2008
063050
March 27, 2008
$301.40
$60,362.62
June 2, 2008
063051
March 27, 2008
$314.05
$60,362.62
June 2, 2008
063052
March 27, 2008
$314.05
$60,362.62
June 2, 2008
063053
March 27, 2008
$176.40
$60,362.62
June 2, 2008
063054
March 27, 2008
$835.07
$60,362.62
June 2, 2008
063055
March 27, 2008
$835.07
$60,362.62
June 2, 2008
063056
March 27, 2008
$1,145.34
$60,362.62
June 2, 2008
063057
March 27, 2008
$253.65
$60,362.62
June 2, 2008
063058
March 27, 2008
$551.46
$60,362.62
June 2, 2008
063059
March 27, 2008
$2,088.30
$60,362.62
June 2, 2008
063109
March 28, 2008
$464.10
$60,362.62
June 2, 2008
063110
March 28, 2008
$475.85
$60,362.62
June 2, 2008
063111
March 28, 2008
$1,755.81
$60,362.62
June 2, 2008
063112
March 28, 2008
$1,880.55
$60,362.62
June 2, 2008
063113
March 28, 2008
$3,349.50
$60,362.62
June 2, 2008
063114
March 28, 2008
$589.17
$60,362.62
June 2, 2008
064223
May 6, 2008
$805.61
$60,362.62
June 2, 2008
064237
May 6, 2008
$1,474.05
$60,362.62
June 2, 2008
064238
May 6, 2008
$609.21
24
February 14, 2008
$1,553.76
Debtor Entity/
Check No.
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63587
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Check Amount
Clear Date
Inv No.
Inv Date
Inv Amt (US Dollars)
$60,362.62
June 2, 2008
064239
May 6, 2008
$1,497.83
$60,362.62
June 2, 2008
064240
May 6, 2008
$1,014.30
$60,362.62
June 2, 2008
064241
May 6, 2008
$2,208.15
$60,362.62
June 2, 2008
064242
May 6, 2008
$1,492.05
$60,362.62
June 2, 2008
064261
May 8, 2008
$68.51
$60,362.62
June 2, 2008
064273
May 9, 2008
$68.51
$60,362.62
June 2, 2008
064294
May 12, 2008
$1,937.26
$60,362.62
June 2, 2008
064295
May 12, 2008
$1,343.48
$60,362.62
June 2, 2008
064315
May 13, 2008
$954.46
$60,362.62
June 2, 2008
064317
May 13, 2008
$3,139.48
$60,362.62
June 2, 2008
064318
May 13, 2008
$4,692.94
$60,362.62
June 2, 2008
064320
May 13, 2008
$2,439.94
$60,362.62
June 2, 2008
064323
May 13, 2008
$3,711.74
$60,362.62
June 2, 2008
064324
May 13, 2008
$3,433.91
$60,362.62
June 2, 2008
064339
May 14, 2008
$1,411.99
$60,362.62
June 2, 2008
064340
May 14, 2008
$310.28
$60,362.62
June 2, 2008
064341
May 14, 2008
$256.50
$60,362.62
June 2, 2008
064342
May 14, 2008
$3,245.28
$60,362.62
June 2, 2008
064343
May 14, 2008
$1,650.32
$60,362.62
June 2, 2008
064344
May 14, 2008
$1,023.60
$60,362.62
June 2, 2008
064345
May 14, 2008
$1,792.35
$60,362.62
June 2, 2008
064346
May 14, 2008
$939.60
$60,362.62
June 2, 2008
064347
May 14, 2007
$1,321.74
$43,588.07
June 18, 2008
063193
March 31, 2008
$486.00
$43,588.07
June 18, 2008
063194
March 31, 2008
$937.08
25
Debtor Entity/
Check No.
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Check Amount
Clear Date
Inv No.
Inv Date
Inv Amt (US Dollars)
$43,588.07
June 18, 2008
063195
March 31, 2008
$236.00
$43,588.07
June 18, 2008
063196
March 31, 2008
$472.00
$43,588.07
June 18, 2008
063197
March 31, 2008
$435.42
$43,588.07
June 18, 2008
063198
March 31, 2008
$472.00
$43,588.07
June 18, 2008
063199
March 31, 2008
$134.40
$43,588.07
June 18, 2008
063200
March 31, 2008
$556.71
$43,588.07
June 18, 2008
063201
March 31, 2008
$556.71
$43,588.07
June 18, 2008
063202
March 31, 2008
$733.64
$43,588.07
June 18, 2008
063203
March 31, 2008
$1,227.42
$43,588.07
June 18, 2008
063204
March 31, 2008
$232.08
$43,588.07
June 18, 2008
063205
March 31, 2008
$1,691.64
$43,588.07
June 18, 2008
063206
March 31, 2008
$237.45
$43,588.07
June 18, 2008
063207
March 31, 2008
$2,449.20
$43,588.07
June 18, 2008
063208
March 31, 2008
$1,975.20
$43,588.07
June 18, 2008
063228
April 2, 2008
$1,308.96
$43,588.07
June 18, 2008
063229
April 2, 2008
$994.00
$43,588.07
June 18, 2008
063230
April 2, 2008
$284.00
$43,588.07
June 18, 2008
063231
April 2, 2008
$126.83
$43,588.07
June 18, 2008
063232
April 2, 2008
$315.12
$43,588.07
June 18, 2008
063233
April 2, 2008
$841.18
$43,588.07
June 18, 2008
063320
April 7, 2008
$977.76
$43,588.07
June 18, 2008
063321
April 7, 2008
$1,636.56
$43,588.07
June 18, 2008
063322
April 7, 2008
$232.08
$43,588.07
June 18, 2008
063323
April 7, 2008
$795.00
$43,588.07
June 18, 2008
063324
April 7, 2008
$331.20
26
Debtor Entity/
Check No.
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Check Amount
Clear Date
Inv No.
Inv Date
Inv Amt (US Dollars)
$43,588.07
June 18, 2008
063325
April 7, 2008
$602.80
$43,588.07
June 18, 2008
063326
April 7, 2008
$170.40
$43,588.07
June 18, 2008
063327
April 7, 2008
$314.05
$43,588.07
June 18, 2008
063328
April 7, 2008
$253.65
$43,588.07
June 18, 2008
063329
April 7, 2008
$551.46
$43,588.07
June 18, 2008
063330
April 7, 2008
$1,788.50
$43,588.07
June 18, 2008
063331
April 7, 2008
$2,662.74
$43,588.07
June 18, 2008
063465
April 9, 2008
$932.23
$43,588.07
June 18, 2008
063466
April 9, 2008
$335.48
$43,588.07
June 18, 2008
063467
April 9, 2008
$256.50
$43,588.07
June 18, 2008
063468
April 9, 2008
$327.92
$43,588.07
June 18, 2008
063469
April 9, 2008
$1,423.21
$43,588.07
June 18, 2008
063470
April 9, 2008
$275.63
$43,588.07
June 18, 2008
063497
April 9, 2008
$932.23
$43,588.07
June 18, 2008
063498
April 9, 2008
$419.19
$43,588.07
June 18, 2008
063499
April 9, 2008
$2,282.27
$43,588.07
June 18, 2008
063500
April 9, 2008
$1,417.23
$43,588.07
June 18, 2008
063976
April 29, 2008
$1,014.30
$43,588.07
June 18, 2008
064223DM
May 6, 2008
$805.61
$43,588.07
June 18, 2008
064241DM
May 6, 2008
$2,208.15
$43,588.07
June 18, 2008
064242DM
May 6, 2008
$1,141.88
$43,588.07
June 18, 2008
064264DM
May 8, 2008
$608.85
$43,588.07
June 18, 2008
064294DM
May 12, 2008
$1,937.26
$43,588.07
June 18, 2008
064295DM
May 12, 2008
$1,168.13
$43,588.07
June 18, 2008
064315DM
May 13, 2008
$954.46
27
Debtor Entity/
Check No.
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63703
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Check Amount
Clear Date
Inv No.
Inv Date
Inv Amt (US Dollars)
$43,588.07
June 18, 2008
064344DM
May 14, 2008
$1,023.60
$43,588.07
June 18, 2008
064347DM
May 14, 2008
$1,321.74
$43,588.07
June 18, 2008
064348
May 14, 2008
$68.51
$43,588.07
June 18, 2008
064373
May 15, 2008
$68.51
$43,588.07
June 18, 2008
064410
May 16, 2008
$2,750.33
$43,588.07
June 18, 2008
064413
May 16, 2008
$2,696.87
$43,588.07
June 18, 2008
064414
May 16, 2008
$1,352.93
$43,588.07
June 18, 2008
064415
May 16, 2008
$335.48
$43,588.07
June 18, 2008
064612
May 21, 2008
$68.51
$43,588.07
June 18, 2008
064637
May 22, 2008
$68.51
$43,588.07
June 18, 2008
064698
May 23, 2008
$68.51
$36,893.57
June 30, 2008
063536
April 14, 2008
$7,906.52
$36,893.57
June 30, 2008
063537
April 14, 2008
$1,048.56
$36,893.57
June 30, 2008
063538
April 14, 2008
$993.80
$36,893.57
June 30, 2008
063539
April 14, 2008
$652.65
$36,893.57
June 30, 2008
063540
April 14, 2008
$268.80
$36,893.57
June 30, 2008
063567
April 15, 2008
$475.50
$36,893.57
June 30, 2008
063568
April 15, 2008
$568.00
$36,893.57
June 30, 2008
063569
April 15, 2008
$556.71
$36,893.57
June 30, 2008
063570
April 15, 2008
$621.01
$36,893.57
June 30, 2008
063599
April 16, 2008
$472.00
$36,893.57
June 30, 2008
063600
April 16, 2008
$193.20
$36,893.57
June 30, 2008
063601
April 16, 2008
$448.40
$36,893.57
June 30, 2008
063602
April 16, 2008
$708.00
$36,893.57
June 30, 2008
063603
April 16, 2008
$268.80
28
Debtor Entity/
Check No.
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
63868
Ascendia Brands
Co Inc
64031
Ascendia Brands
Co Inc
64031
Ascendia Brands
Co Inc
64031
Check Amount
Clear Date
Inv No.
Inv Date
Inv Amt (US Dollars)
$36,893.57
June 30, 2008
063604
April 16, 2008
$472.00
$36,893.57
June 30, 2008
063605
April 16, 2008
$193.20
$36,893.57
June 30, 2008
063606
April 16, 2008
$1,091.04
$36,893.57
June 30, 2008
063607
April 16, 2008
$232.08
$36,893.57
June 30, 2008
063608
April 16, 2008
$477.00
$36,893.57
June 30, 2008
063609
April 16, 2008
$170.40
$36,893.57
June 30, 2008
063610
April 16, 2008
$602.80
$36,893.57
June 30, 2008
063611
April 16, 2008
$471.08
$36,893.57
June 30, 2008
063612
April 16, 2008
$942.15
$36,893.57
June 30, 2008
063613
April 16, 2008
$176.40
$36,893.57
June 30, 2008
063614
April 16, 2008
$297.60
$36,893.57
June 30, 2008
063615
April 16, 2008
$155.00
$36,893.57
June 30, 2008
063616
April 16, 2008
$360.68
$36,893.57
June 30, 2008
063617
April 16, 2008
$1,224.55
$36,893.57
June 30, 2008
0644891
May 29, 2008
$68.51
$36,893.57
June 30, 2008
064861
May 28, 2008
$3,014.55
$36,893.57
June 30, 2008
064862
May 28, 2008
$3,805.99
$36,893.57
June 30, 2008
064863
May 28, 2008
$3,317.47
$36,893.57
June 30, 2008
064876
May 28, 2008
$2,501.89
$36,893.57
June 30, 2008
064877
May 28, 2008
$79.92
$36,893.57
June 30, 2008
064973
May 31, 2008
$66.51
$36,893.57
June 30, 2008
064974
May 31, 2008
$1,990.80
$122,440.15
July 9, 2008
063665
April 21, 2008
$626.40
$122,440.15
July 9, 2008
063671
April 21, 2008
$2,112.58
$122,440.15
July 9, 2008
063672
April 21, 2008
$3,190.00
29
Debtor Entity/
Check No.
Ascendia Brands
Co Inc
64031
Ascendia Brands
Co Inc
64031
Ascendia Brands
Co Inc
64031
Ascendia Brands
Co Inc
64031
Ascendia Brands
Co Inc
64031
Ascendia Brands
Co Inc
64031
Ascendia Brands
Co Inc
64031
Ascendia Brands
Co Inc
64031
Ascendia Brands
Co Inc
70309
Ascendia Brands
Co Inc
70317
Check Amount
Clear Date
Inv No.
Inv Date
Inv Amt (US Dollars)
$122,440.15
July 9, 2008
063812
April 22, 2008
$1,973.20
$122,440.15
July 9, 2008
063813
April 22, 2008
$1,726.20
$122,440.15
July 9, 2008
063820
April 22, 2008
$472.00
$122,440.15
July 9, 2008
063935
April 25, 2008
$110,095.97
$122,440.15
July 9, 2008
064992
June 3, 2008
$75.90
$122,440.15
July 9, 2008
065000
June 3, 2008
$69.49
$122,440.15
July 9, 2008
065008
June 4, 2008
$397.41
$122,440.15
July 9, 2008
065009
June 4, 2008
$1,701.00
$66,712.67
July 28, 2008
JULY08DEP
July 28, 2008
$66,712.67
$3,814.76
July 31, 2008
073108DEP
July 31, 2008
$3,814.76
Total Invoices: 280
Total Amount:
30
$436,642.22