“When the Rule 9(b) pleading standard applies, the complaint must contain factual allegations stating the ‘time, place, and contents of the false representations, as well as the identity of the person making the misrepresentation and what [that person] obtained thereby.’” “In other words, to properly allege fraud under Rule 9(b), the plaintiff must plead the who, what, when, where, and why as to the fraudulent conduct.”

The circuit courts that have addressed the question provided little or no direct analysis in support of their holdings. The Second Circuit held that Rule 9(b) applies because “‘actual intent to hinder, delay, or defraud’ constitutes fraud….” The Seventh Circuit applied Rule 9(b) without significant analysis. The Eighth Circuit at least twice held without discussion that claims under the Minnesota Uniform Fraudulent Transfer Act are subject to Rule 9(b). The Fifth Circuit expressly declined to say whether rule 9(b) applies to fraudulent transfer claims.

The already notorious Paycheck Protection Program (PPP) is part of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). $349 billion of PPP funding became available on Friday, April 3, and less than two weeks later all $349 billion was disbursed or committed to being disbursed. Congress then passed legislation adding $310 billion of PPP funding. Several bankruptcy judges have already questioned whether funds disbursed to applicants under the PPP are correctly characterized as loans or are instead grants, reasoning that if PPP funds are properly used, there is no intent the funds disbursed will be repaid.

In Veritex Community Bank v. Osborne, the Fifth Circuit evaluated whether a debtor who provided a materially false financial statement should be discharged of the debt that resulted from a loan that was granted largely because of misrepresentations made by the debtor within the written statement. Section 523(a)(2)(B) provides that an individual debtor is not discharged from any debt:

The decrease in airline travel demand also presents aviation companies with a variety of present and future contract disputes. To name a few, companies are likely to face issues arising from employment contracts, supply contracts, and repair and maintenance contracts. The practical effect is that aviation companies will see a flood of litigation arising from actual or prior material breaches of contract.

The Bankruptcy Code does not specifically define “reasonably equivalent value.” In recent years, courts have grappled with whether a trustee can claw back college tuition payments made by parents on behalf of an adult child on the theory that they are constructively fraudulent transfers. The issue is “culturally and socially charged,” and in these cases, the outcome depends on how the court defines “reasonably equivalent value.”