Section 546(e) of the Bankruptcy Code's "safe harbor" preventing avoidance in bankruptcy of certain securities, commodity, or forward-contract payments has long been a magnet for.
Section 546(e) of the Bankruptcy Code's "safe harbor" preventing avoidance in bankruptcy of certain securities, commodity, or forward-contract payments has long been a magnet for controversy.
Judge Shannon is second judge to press Congress to narrow section 546e safe harbor. Judge Robert Drain warned, that section 546e overbroad exemption has enabled private equity companies to siphon billions in debt-funded dividends from the companies they own.
Delaware Judge Brendan Shannon has joined calls for reforming Section 546(e) of the bankruptcy code, echoing concerns that the section’s safe harbor from fraudulent transfer liability.
On October 12, 2022, the U.S. Bankruptcy Court for the Southern District of New York denied motions to dismiss fraudulent transfer claims asserted against certain investors in Tops.