Geltzer v. Artists Marketing Corp. (In Re Cassandra Group)
Robert L. Geltzer, the Chapter 7 Trustee for The Cassandra Group, initiated this action to avoid a $300,000 transfer from the Debtor to Artists Marketing Corporation (AMC), Lawrence E. Bathgate, and The Bathgate Group. The Trustee alleged the transfer constituted a fraudulent conveyance under the Bankruptcy Code and New York Debtor and Creditor Law, and also sought recovery for unjust enrichment. The court found that The Cassandra Group was insolvent at the time of the transfer and that the transfer lacked fair consideration and good faith. The defendants, AMC, Bathgate, and The Bathgate Group, were deemed to have benefited from the transfer despite their role in allowing a key celebrity (DiCaprio) to rescind an agreement without legal basis, which contributed to the failure of the AMC venture. Consequently, the court ruled that the $300,000 transfer is avoidable and awarded prejudgment interest to the Trustee.