Case Study: Marathon Petroleum V. Cohen

Law360, New York (May 6, 2010, 12:42 PM EDT) -- Trade creditors, take note: Even though Chapter 11 debtors may continue purchasing goods and services and may continue operating in the ordinary course of their business, an earned cash payment in the creditor's hands may not be safe from recovery. Moreover, if you are a party to a supply contract and under an obligation to continue to furnish goods or services, the payments you receive may be recoverable by a subsequently appointed trustee.

The 11th Circuit recently upheld a bankruptcy court ruling that a post-petition trade...
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