Are customers who withdraw their profits and lending earnings from FTX during its last days before its bankruptcy liable to clawback from creditors? It seems that some companies and investors, such as Binance, are liable to pay creditors through clawback for FTX collapse as a result of fraud. https://cointelegraph.com/news/companies-and-investors-may-need-to-return-billions-in-funds-paid-by-ftx What about profitable customers? Suppose a customer made trading profits and earned interest from lending his cryptocurrencies on FTX. He managed to withdraw his funds just hours before FTX's collapse. Is he liable to for the clawback?
united-states Are customers who withdraw their profits and lending earnings from FTX during its last days before its bankruptcy liable to clawback from creditors? It seems that some companies and investors, such as Binance, are liable to pay creditors through clawback for FTX collapse as a result of fraud. If the right conditions are met the amounts paid can be clawed back. There are a lot of special rules that apply but the most general is that if you receive money or property to pay an amount owed on a debt within 90 days of the bankruptcy petition being filed without providing substantially contemporaneous and equivalent value at the time that you receive the money, and the amount received is more than you would have received in a Chapter 7 bankruptcy, then the amount received may be clawed back into the bankruptcy estate. Usually, in financial transactions, the dollar values in an account in your name are considered to be contractual debts owed by the financial institution to you, rather than &quot;your property&quot;. So paying amount the balance of an account (to the extent it has been at that level for at least 90 days before the filing of the bankruptcy petition) will usually be a preference and give rise to a clawback obligation if the bankruptcy estate choses to enforce that right (in a Chapter 7 that call is made by the bankruptcy trustee, in a Chapter 11 that call is made by the &quot;debtor-in-possession&quot;). If a clawback amount is not returned voluntarily, court action can be taken to recover it. This is what a court has ruled, for example, in one recent crypto bankruptcy case. The lookback period is 1 year rather than 90 days for &quot;insiders&quot;. If the debt is backed by new collateral in this time period, even if not paid, the agreement to provide new collateral can be invalidated (certain additional technical rules apply to this provision). Small amounts (up to $600 for consumer debtors and $5,000 for non-consumer debtors) are disregarded even if the payment would otherwise be a preference subject to being clawed back. To make sure I have fully answered the question: What about profitable customers? Suppose a customer made trading profits and earned interest from lending his cryptocurrencies on FTX. He managed to withdraw his funds just hours before FTX's collapse. Is he liable to for the clawback? Yes. If the conditions described above are met. The logic is that people who pull out money at the last minute due to luck or insider information should not be treated differently than those who do not do so. The relevant section of the bankruptcy code is 11 U.S. Code § 547 (Preferences). It states: (a)In this section— (1)“inventory” means personal property leased or furnished, held for sale or lease, or to be furnished under a contract for service, raw materials, work in process, or materials used or consumed in a business, including farm products such as crops or livestock, held for sale or lease; (2)“new value” means money or money’s worth in goods, services, or new credit, or release by a transferee of property previously transferred to such transferee in a transaction that is neither void nor voidable by the debtor or the trustee under any applicable law, including proceeds of such property, but does not include an obligation substituted for an existing obligation; (3)“receivable” means right to payment, whether or not such right has been earned by performance; and (4)a debt for a tax is incurred on the day when such tax is last payable without penalty, including any extension. (b)Except as provided in subsections (c), (i), and (j) of this section, the trustee may, based on reasonable due diligence in the circumstances of the case and taking into account a party’s known or reasonably knowable affirmative defenses under subsection (c), avoid any transfer of an interest of the debtor in property— (1)to or for the benefit of a creditor; (2)for or on account of an antecedent debt owed by the debtor before such transfer was made; (3)made while the debtor was insolvent; (4)made— (A)on or within 90 days before the date of the filing of the petition; or (B)between ninety days and one year before the date of the filing of the petition, if such creditor at the time of such transfer was an insider; and (5)that enables such creditor to receive more than such creditor would receive if— (A)the case were a case under chapter 7 of this title; (B)the transfer had not been made; and (C)such creditor received payment of such debt to the extent provided by the provisions of this title. (c)The trustee may not avoid under this section a transfer— (1)to the extent that such transfer was— (A)intended by the debtor and the creditor to or for whose benefit such transfer was made to be a contemporaneous exchange for new value given to the debtor; and (B)in fact a substantially contemporaneous exchange; (2)to the extent that such transfer was in payment of a debt incurred by the debtor in the ordinary course of business or financial affairs of the debtor and the transferee, and such transfer was— (A)made in the ordinary course of business or financial affairs of the debtor and the transferee; or (B)made according to ordinary business terms; (3)that creates a security interest in property acquired by the debtor— (A)to the extent such security interest secures new value that was— (i)given at or after the signing of a security agreement that contains a description of such property as collateral; (ii)given by or on behalf of the secured party under such agreement; (iii)given to enable the debtor to acquire such property; and (iv)in fact used by the debtor to acquire such property; and (B)that is perfected on or before 30 days after the debtor receives possession of such property; (4)to or for the benefit of a creditor, to the extent that, after such transfer, such creditor gave new value to or for the benefit of the debtor— (A)not secured by an otherwise unavoidable security interest; and (B)on account of which new value the debtor did not make an otherwise unavoidable transfer to or for the benefit of such creditor; (5)that creates a perfected security interest in inventory or a receivable or the proceeds of either, except to the extent that the aggregate of all such transfers to the transferee caused a reduction, as of the date of the filing of the petition and to the prejudice of other creditors holding unsecured claims, of any amount by which the debt secured by such security interest exceeded the value of all security interests for such debt on the later of— (A) (i)with respect to a transfer to which subsection (b)(4)(A) of this section applies, 90 days before the date of the filing of the petition; or (ii)with respect to a transfer to which subsection (b)(4)(B) of this section applies, one year before the date of the filing of the petition; or (B)the date on which new value was first given under the security agreement creating such security interest; (6)that is the fixing of a statutory lien that is not avoidable under section 545 of this title; (7)to the extent such transfer was a bona fide payment of a debt for a domestic support obligation; (8)if, in a case filed by an individual debtor whose debts are primarily consumer debts, the aggregate value of all property that constitutes or is affected by such transfer is less than $600; or (9)if, in a case filed by a debtor whose debts are not primarily consumer debts, the aggregate value of all property that constitutes or is affected by such transfer is less than $5,000.2 (d)The trustee may avoid a transfer of an interest in property of the debtor transferred to or for the benefit of a surety to secure reimbursement of such a surety that furnished a bond or other obligation to dissolve a judicial lien that would have been avoidable by the trustee under subsection (b) of this section. The liability of such surety under such bond or obligation shall be discharged to the extent of the value of such property recovered by the trustee or the amount paid to the trustee. (e)(1)For the purposes of this section— (A)a transfer of real property other than fixtures, but including the interest of a seller or purchaser under a contract for the sale of real property, is perfected when a bona fide purchaser of such property from the debtor against whom applicable law permits such transfer to be perfected cannot acquire an interest that is superior to the interest of the transferee; and (B)a transfer of a fixture or property other than real property is perfected when a creditor on a simple contract cannot acquire a judicial lien that is superior to the interest of the transferee. (2)For the purposes of this section, except as provided in paragraph (3) of this subsection, a transfer is made— (A)at the time such transfer takes effect between the transferor and the transferee, if such transfer is perfected at, or within 30 days after, such time, except as provided in subsection (c)(3)(B); (B)at the time such transfer is perfected, if such transfer is perfected after such 30 days; or (C)immediately before the date of the filing of the petition, if such transfer is not perfected at the later of— (i)the commencement of the case; or (ii)30 days after such transfer takes effect between the transferor and the transferee. (3)For the purposes of this section, a transfer is not made until the debtor has acquired rights in the property transferred. (f)For the purposes of this section, the debtor is presumed to have been insolvent on and during the 90 days immediately preceding the date of the filing of the petition. (g)For the purposes of this section, the trustee has the burden of proving the avoidability of a transfer under subsection (b) of this section, and the creditor or party in interest against whom recovery or avoidance is sought has the burden of proving the nonavoidability of a transfer under subsection (c) of this section. (h)The trustee may not avoid a transfer if such transfer was made as a part of an alternative repayment schedule between the debtor and any creditor of the debtor created by an approved nonprofit budget and credit counseling agency. (i)If the trustee avoids under subsection (b) a transfer made between 90 days and 1 year before the date of the filing of the petition, by the debtor to an entity that is not an insider for the benefit of a creditor that is an insider, such transfer shall be considered to be avoided under this section only with respect to the creditor that is an insider. (j) (1)In this subsection: (A)The term “covered payment of rental arrearages” means a payment of arrearages that— (i)is made in connection with an agreement or arrangement— (I)between the debtor and a lessor to defer or postpone the payment of rent and other periodic charges under a lease of nonresidential real property; and (II)made or entered into on or after March 13, 2020; (ii)does not exceed the amount of rental and other periodic charges agreed to under the lease of nonresidential real property described in clause (i)(I) before March 13, 2020; and (iii)does not include fees, penalties, or interest in an amount greater than the amount of fees, penalties, or interest— (I)scheduled to be paid under the lease of nonresidential real property described in clause (i)(I); or (II)that the debtor would owe if the debtor had made every payment due under the lease of nonresidential real property described in clause (i)(I) on time and in full before March 13, 2020. (B)The term “covered payment of supplier arrearages” means a payment of arrearages that— (i)is made in connection with an agreement or arrangement— (I)between the debtor and a supplier of goods or services to defer or postpone the payment of amounts due under an executory contract for goods or services; and (II)made or entered into on or after March 13, 2020; (ii)does not exceed the amount due under the executory contract described in clause (i)(I) before March 13, 2020; and (iii)does not include fees, penalties, or interest in an amount greater than the amount of fees, penalties, or interest— (I)scheduled to be paid under the executory contract described in clause (i)(I); or (II)that the debtor would owe if the debtor had made every payment due under the executory contract described in clause (i)(I) on time and in full before March 13, 2020. (2)The trustee may not avoid a transfer under this section for— (A)a covered payment of rental arrearages; or (B)a covered payment of supplier arrearages.
Although crypto space may be little regulated, insurance is in most jurisdictions highly regulated. Any such arrangement would need to comply with current laws on insurance, until and unless modified laws to cover this sort of thing are passed, and then it would need to comply with those. Tax authorities generally allow one to declare &quot;other business income&quot; or &quot;other investment income&quot; without forming a legal entity. I cannot say how such income would be classified in any given jurisdiction. Whether the platform, or some legal entity associated with the platform, would need to be registered will depend on the current laws and regulations governing insurance, and on the way in which teh contracts are structured. A disclaimer cannot prevent one from being sued. The contracts would need to carefully and explicitly state who is liable for what. Programs cannot be held accountable for anything. Legal entities, including operators of programs, can be. If negligence in the creation or operation of a program causes a loss, the operator may well be liable. Programs cannot be sued for anything. Legal entities, including operators of programs, can be. It may well be essential to constitute the &quot;platform&quot; as a legal entity of some sort. Otherwise its operator will be liable for its actions. I cannot be sure. I once encountered a somewhat similar system in which insurance was provided by individuals exchanging contracts, so that in a sense each member insured all the others. There was a company that supervised and provided legal and administrative services to the group of individuals, and collected fees for this. That sounds a bit similar to the suggested platform, but I don't know exactly how that company was organized. The system was called &quot;NJ CURE&quot;. I don't know if it is still in operation.
I'm assuming you're talking about U.S. federal bankruptcy law (Title 11). Once bankruptcy is declared, any claims against the debtor are subject to the bankruptcy laws, and any claims against the debtor in any other court are automatically stayed under 11 USC 362. That means if you bring an action against the debtor for conversion, a court will not hear it, because the debtor's bankruptcy stays any such action. It gets more complicated if you want to sue the brother. In general, except in limited circumstances, the brother is not protected by the bankruptcy stay. [source]. So you can likely sue the brother. Your question about "priority," however, may be based on a misunderstanding of how the law works. If you sue the brother and win, you will get a judgment against the brother, which you can then attempt to collect from the brother's assets. If the trustee convinces a court that the property in question is, in fact, the property of the estate, the trustee can recover it from the brother, or from anyone the brother subsequently gave it to, until it is transferred to a bona fide purchaser for value--who must be unaware of the fraudulent nature of the conveyance. See 11 USC 550. Because you were aware of the fraud, you are not a bona fide purchaser for value, and the statute seems to give the trustee the ability to recover the money from you, just as it would from the brother. In practical terms, this will rarely happen--but if it did, the bankruptcy estate would win, because the avoidance of a transfer means the property was never the brother's in the first place.
If you were to seek legal recourse for breach of contract (their Terms and Conditions), the best outcome you could hope for would be "making whole", and since they have already offered this a court could award you what the retailer already offered, but make legal costs on both sides the plaintiff's liability (ie. you), since you could have taken the offer and avoided court. The Terms and Conditions associated with the discount code mean that you won't be able to return the gift cards for cash. It will be argued that by using the code, you agreed to those terms and conditions. The second paragraph of their reply looks like an attempt to scare you, but it has legal merit. By using the unauthorised code you could be considered to have made false representation when you entered into the contract. This could render the contract void, and if they could demonstrate it had been done deliberately to gain money it could meet the threshold for fraud (which is what the police would possibly investigate : if it can be shown that you were aware the discount code didn't apply to you it would constitute making "a false representation ... to make a gain for himself" [sub-paragraphs 1-5, paragraph 2 of the Fraud Act 2006]). You may be able to argue that the voucher websites misled you (though it sounds like you, I and the retailer already know that's not true), but since the retailer has offered to repay what you paid there are unlikely to be any damages - and, unless the voucher site took commission from your transaction, a contract between you and the voucher sites would be difficult (possibly impossible) to establish. In the circumstances, returning what you originally paid is a good offer.
None The contractual chain is you &lt;-> warranty company &lt;-> (potentially others you don’t know about) &lt;-> service provider. Should something go wrong, you would sue your warranty company who might (it is up to them) then sue the service provider. Notwithstanding, it’s likely the service company owes you a duty of care and would be directly liable to you for a negligence claim.
"Fraud" requires an intent to deceive. In cases like this I would fall back on the saying, "Never attribute to malice what can be explained by incompetence." Practically speaking: the email you received from them is an amendment to their Terms of Service. I.e., your contract with the company starts with their standard Terms of Service, and is modified by any agreement you reach that explicitly supersedes the ToS. Based on your description it is your credit card company that is in violation of its duty to adjudicate chargebacks. If you refuse the charge, and present the email agreement and evidence of A's "failure," then the card company has no grounds to impose the charge on you (unless the merchant in its response to the chargeback can convincingly argue that the email agreement is invalid).
The European laws have specific sections regarding digital goods. The following two passages are relevant to you: From Returning unwanted goods: Warning! Please note that you may not use goods that you have received before deciding to withdraw from the purchase. The right to withdraw exists to allow you to examine the product in the same way as you would in a shop, not to give you 14 days free use. Be aware also that more specific rules apply to digital content (e.g. downloading or streaming music or video). From Shopping online: Digital content Specific information requirements apply when you buy digital content online, e.g. when downloading or streaming music or video. Before you make the purchase, you must also be informed how the content operates with relevant hardware/software (interoperability) and about its functionality, including whether any geographical restrictions apply to the use of the content and if private copies are allowed. You also enjoy the right of withdrawal within 14 days from concluding the contract for online digital content. However, once you start downloading or streaming the content you may no longer withdraw from the purchase, provided that the trader has complied with his obligations. Specifically, the trader must first obtain your explicit agreement to the immediate download or streaming, and you must explicitly acknowledge that you lose your right to withdraw once the performance has started. So yes, the law specifically allows you to waive that right when purchasing digital goods. So long as Steam has correctly advertised the product's system requirements and other key details, you lose your right to withdraw from the purchase the moment you start downloading it to your system.
Yes. Money damages can be awarded in this circumstance and would likely be awarded if the infringement was found to have occurred and not to have been fair use. Even in the absence of proof that any profits are made, there are statutory damages that can be awarded on a per offense basis for copyright violations, and trademark cases in addition to having statutory violations can measure damages by harm to the trademark owner and not just unjust enrichment to the infringer.