In other cases where preference defendants have successfully proven ordinary course of business defenses, the defendants have also presented evidence of their competitors’ receivables and collections practices and of the actual payment practices of the defendants’ competitors’ customers. In Solow, supra, the evidence included the debtor’s payment history to its other law firms and also evidence of schwinn dealers the defendant’s competitors’ accounts receivables practices and the aging of their accounts. Solow, 180 B.R. The Solow bankruptcy court expressly distinguished that case from another in which the defendant’s president had admitted that he had no knowledge of his competitors’ receivables practices. Luper, 91 F.3d at 814. Likewise, in McCord v. Venus Foods, Inc. (In re Lan Yik Foods Corp.), 185 B.R.
“Even if we built every bicycle in this country, you would probably build them with less than 10,000 people. And that’s not nearly as strategic as the automobile industry, which employs half a million people,” Schwinn said. Richard Schwinn said bicycle manufacturing isn’t and has never been a large enough industry in the U.S. to warrant schwinn ebike government protection or subsidies like the automobile industry. Presumed to be unreasonable, and therefore illegal withoutelaborate inquiry as to the precise harm they have caused or thebusiness excuse for their use.” If you like Stingrays and Krates (I don’t…don’t get me started!), check out the bicyclehistory.com page abotu them.
As with the award of prejudgment interest itself, the rate of interest is likewise within the court’s sound discretion. Energy Co-op, 130 B.R. At 792 (citations omitted). Some bankruptcy courts have concluded that the coupon yield rate set forth in 28 U.S.C. § 1961 is appropriate. In re Helen Gallagher Enterprises, Inc., 126 B.R. 997, 1005 (Bankr.C.D.Ill. 1991).
That was a reasonable conclusion on their part given the frequency and urgency of the calls. Thus, the collection calls resulted in the Defendant receiving the transfers instead of other creditors of the Debtors. In this regard alone, Defendant has therefore failed to meet its burden under § 547(c)(2)(B). Contrary to Defendant’s contention, the post-bankruptcy substantive consolidation of the Debtors’ several bankruptcy estates does not support a calculation on a consolidated basis of the Defendant’s new value defense to pre-bankruptcy transactions. As found above, however, Defendant did establish at trial that the alleged new value shipments were actually received by the Debtor or its dealers, and that the new value shipments remained unpaid as of the Petition Date.
As a result, during the Preference Period, lenders were monitoring Debtors’ borrowing base and periodically sweeping cash from the Debtors’ operating accounts. Additionally, Debtors’ sales, inventory levels, and accounts receivable all had decreased markedly during 1992, further restricting Debtors’ borrowing base and their access to financing. All of these factors left the Debtors’ during the Preference Period with insufficient cash to pay their vendors’ outstanding invoices or with which to acquire new shipments of product. By 1990, other United States bicycle companies with reputations for excellence in design such as Trek, Specialized, and Cannondale had cut further into Schwinn’s market. Unable to produce bicycles in the United States at a competitive cost, by the end of 1991 Schwinn was sourcing its bicycles from overseas manufacturers.
According to Thorholm, the payments were sent to Defendant because he understood that Defendant would not ship product to the Debtors unless they made payments on outstanding invoices. With regard to Defendant’s asserted ordinary course of business defense, the evidence to be considered starts with earlier Findings in the Common Issues Opinion. There it was found that Debtors were not operating in the Preference Period as they had previously because of their poor financial situation. Debtors experienced a severe cash crisis during the preference period and were unable to pay their payables as they came due in the ordinary course. Debtors had violated certain debt covenants in their loan agreements with their banks in early 1992.