In Re M & L Business Machine Company, Inc.

How courts have described this case

Verbatim parenthetical descriptions written by other courts when citing this decision. Ranked by citation-network relevance.

• concluding lower court’s finding of good faith on the part of the transferee is primarily factual and should be reviewed for clear error
• determining that the ordinary course of business defense was not applicable to payments by a fake business set up to defraud people
• determining that the ordinary course of business defense was not applicable to payments by a fake business set up to defraud people
• holding the test to be whether “‘the circumstances would place a reasonable person on inquiry of a debtor’s fraudulent purpose, and a diligent inquiry would have discovered the fraudulent purpose, then the transfer is fraudulent’ ”
• applying an objective test and finding a lack of good faith if the circumstances would place a reasonable person on inquiry of a debtor's fraudulent purpose
• affirming the bankruptcy court’s application of the standard to a “reasonably prudent investor in [the transferee’s] position.”

Source: CourtListener parenthetical corpus (CC0).