The defendants, McCarney Group LLP et al., sought summary judgment to set aside transactions restructuring an accounting firm ("Oldco") under various insolvency and fraudulent conveyance statutes.
The plaintiffs, former partners and an affiliate of Oldco, alleged the restructuring was a transfer at undervalue designed to defeat their claims.
The court denied the defendants' motion for summary judgment, finding genuine issues for trial regarding Oldco's insolvency at the time of the restructuring and whether the assets (accounts receivable, work-in-process, and goodwill) were transferred at an undervalue.
The court emphasized that expert reports are not strictly required to establish an undervalue, and that oral testimony and cross-examination were necessary to resolve factual disputes regarding asset valuation and the existence of goodwill.
