Law360, New York (May 12, 2016, 12:56 PM EDT) -- Do constructive fraudulent transfer claims that were not pursued by a trustee in a bankruptcy proceeding revert to creditors? In In re Tribune Co. Fraudulent Conveyance Litig.,[1] the Second Circuit answered in the negative. The Second Circuit ultimately reached its conclusion by relying on preemption under 11 U.S.C. § 546(e), but only following a lengthy discussion of the resulting "ambiguities, anomalies, and conflicts" if the answer was yes. While this discussion does not have precedential value — the court notes several times that it need not resolve the question — it provides a persuasive argument that the answer of whether fraudulent conveyance claims revert to individual creditors would still likely be "no" even were Section 546(e) not to apply....
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