  |
  |
  |
    
  
   |
 | |||
|
|
|
|
| |||
C. Burden of Proof.
The trustee bears the burden of establishing that a preference exists. 11 U.S.C. § 547(b); 11 U.S.C. § 547(g); see also Union Bank v. Wolas, 502 U.S. 151, 112 S. Ct. 527, 116 L. Ed. 2d 514 (1991); Alfa Mut. Fire Ins. Co. v. Memory (In re Martin), 184 B.R. 985 (M.D. Ala. 1995) aff'd, 101 F.3d 708 (11th Cir. 1996); Hall v. Ford Motor Credit Co. (In re JKJ Chevrolet, Inc.), 412 F.3d 545 (4th Cir. 2005); Bryant v. JCOR Mech., Inc. (In re Electron Corp.), 336 B.R. 809 (B.A.P. 10th Cir. 2006). If the trustee puts forward sufficient evidence to make out a prima facie case on section 547(b), the burden shifts to the transferee to present sufficient evidence to call into question whether the trustee has sustained his or her burden of proof.
A preference defendant is limited to the statutory affirmative defenses under section 547(c) and threshold defenses such as lack of jurisdiction, service of process, standing and the like. Kmart Corp. v. Uniden Am. Corp. (In re K-Mart Corp.), No. 04 C 4978, 2004 U.S. Dist. LEXIS 19829 (N.D. Ill. Sept. 30, 2004; Raleigh v. Mid Am. Nat'l Bank & Trust Co. (In re Stoecker), 131 B.R. 979, 983 (Bankr. N.D. Ill. 1991). The threshold defenses, however, are not defenses on the subject transfers involved in the preference litigation. As a result, it is "well established" that the exceptions under § 547(c) are the exclusive substantive defenses to liability under § 547(b). Id.; see also Official Unsecured Creditors Comm. of Intrastate Elec. Servs., Inc. v. Intrastate Sheet Metal, Inc. (In re Intrastate Elec. Servs., Inc.), No. 95 B 20173, 2000 WL 1346696 (Bankr. N.D. Ill. Sept. 8, 2000).
If a preference is established by the trustee, the transferee-defendant has the burden of establishing the exceptions to avoidance in section 547(c). 11 U.S.C. § 547(g); see also Union Bank v. Wolas, 502 U.S. 151, 112 S. Ct. 527, 116 L. Ed. 2d 514 (1991).
