TAGGED OPINION

UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF FLORIDA

www.flsb.uscourts.gov

In re:

GRANDPARENTS.COM, INC., et al.,

1

Debtors.

______________________________________/

Chapter 11 Cases

Case No. 17-14711-LMI

(Jointly Administered)

JOSHUA RIZACK, as Liquidating Trustee, 

Plaintiff, 

v.

STARR INDEMNITY & LIABILITY 

COMPANY, 

Defendant. 

______________________________________/

Adv. Case No.: 19-01289-LMI

ORDER GRANTING IN PART AND DENYING IN PART 

STARR INDEMNITY & LIABILITY COMPANY’S MOTION TO DISMISS 

1 The Debtors in these jointly administered cases are (i) Grandparents.com Inc., and (ii) Grand 

Card LLC (Case No. 17-14704-LMI), which are jointly referred to herein as the “Debtor”.

Laurel M. Isicoff

Chief United States Bankruptcy Judge

___________________________________________________________________________

ORDERED in the Southern District of Florida on April 10, 2020.

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THIS CAUSE came before the Court for a hearing on November 20, 2019,

upon the Motion to Dismiss Adversary Complaint (“Motion to Dismiss”) filed by 

Defendant Starr Indemnity & Liability Company’s (“Starr” or “Defendant”)2; the 

Response filed by Plaintiff Joshua Rizack, as Liquidating Trustee (“Trustee” or 

“Plaintiff”)

3; and the Defendant’s Reply4. 

After reviewing the referenced pleadings, the supplemental authority filed by 

the parties5, having heard the argument of counsel, considering the record and 

for the reasons set forth below, the Court denies in part and grants in part the

Motion to Dismiss.

I. Jurisdiction and Venue

This Court has jurisdiction over this adversary proceeding pursuant to 28 

U.S.C. §§157(b) and 1334(b), and Administrative Order 2012-25 of the United 

States District Court, Southern District of Florida. Additionally, this Court has 

jurisdiction over this action pursuant to Sections 11.1 and 12.1(b) of the First 

Amended Joint Plan of Liquidation (the “Plan”) (ECF #183) and Paragraph 26(ii) 

2 Starr Indemnity & Liability Company’s Motion To Dismiss Adversary Complaint Filed By 

Liquidating Trustee Joshua Rizack (ECF #20).

3 Liquidating Trustee’s Response To Starr Indemnity & Liability Company’s Motion To Dismiss (ECF 

#23).

4 Starr Indemnity & Liability Company’s Reply In Further Support Of Its Motion To Dismiss 

Adversary Complaint (ECF #29).

5 Liquidating Trustee’s Notice Of Supplemental Authority In Further Support Of His Response (DE 

23) To Starr Indemnity & Liability Company’s Motion To Dismiss (DE 20) (ECF #38); Starr 

Indemnity & Liability Company’s Notice Of Supplemental Authority (ECF #39); Starr Indemnity & 

Liability Company’s Second Notice Of Supplemental Authority (ECF #41); and Liquidating Trustee’s 

Amended Second Notice Of Supplemental Authority In Further Support Of His Response (DE 23)To 

Starr Indemnity & Liability Company’s Motion To Dismiss (DE 20) (ECF #48).

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of the Order Confirming the Debtor’s First Amended Chapter 11 Plan of Liquidation

(the “Confirmation Order”) (ECF #228) entered on September 20, 2019. 

The Court is authorized to hear and enter final orders in this matter pursuant 

to 28 U.S.C. § 157(b)(2)(F), (H) and (O).

Venue is proper in this district pursuant to 28 U.S.C. §§1408 and 1409(a).

II. Factual Allegations

The Plaintiff filed his four count Complaint (ECF #1) on July 31, 2019. Count 

I seeks to avoid an allegedly fraudulent transfer pursuant to 

11 U.S.C. §548(a)(1)(B)6 and 726.106(1)7; Count II seeks to avoid an allegedly 

fraudulent transfer pursuant to 11 U.S.C. §5448 and Fla. Stat. §726.106(1); 

6

“(a) The trustee may avoid any transfer (including any transfer to or for the benefit of an insider 

under an employment contract) of an interest of the debtor in property, or any obligation 

(including any obligation to or for the benefit of an insider under an employment contract) 

incurred by the debtor, that was made or incurred on or within 2 years before the date of the 

filing of the petition, if the debtor voluntarily or involuntarily—(B)(i) received less than a 

reasonably equivalent value in exchange for such transfer or obligation; and (ii)(I) was insolvent 

on the date that such transfer was made or such obligation was incurred, or became insolvent 

as a result of such transfer or obligation; (II) was engaged in business or a transaction, or was 

about to engage in business or a transaction, for which any property remaining with the debtor 

was an unreasonably small capital; (III) intended to incur, or believed that the debtor would 

incur, debts that would be beyond the debtor’s ability to pay as such debts matured; or (IV) made 

such transfer to or for the benefit of an insider, or incurred such obligation to or for the benefit 

of an insider, under an employment contract and not in the ordinary course of business.” 11 

U.S.C. §548(a)(1)(B). 

7 “(1) A transfer made or obligation incurred by a debtor is fraudulent as to a creditor whose 

claim arose before the transfer was made or the obligation was incurred if the debtor made the 

transfer or incurred the obligation without receiving a reasonably equivalent value in exchange 

for the transfer or obligation and the debtor was insolvent at that time or the debtor became 

insolvent as a result of the transfer or obligation.” Fla. Stat. §726.106(1).

8

“(a) The trustee shall have, as of the commencement of the case, and without regard to any 

knowledge of the trustee or of any creditor, the rights and powers of, or may avoid any transfer 

of property of the debtor or any obligation incurred by the debtor that is voidable by—(1) a 

creditor that extends credit to the debtor at the time of the commencement of the case, and that 

obtains, at such time and with respect to such credit, a judicial lien on all property on which a 

creditor on a simple contract could have obtained such a judicial lien, whether or not such a 

creditor exists; (2) a creditor that extends credit to the debtor at the time of the commencement 

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Count III seeks to recover property transferred or the value of such property 

pursuant to 11 U.S.C. §5509 and Fla Stat. §§726.10810 and 726.10911; and 

Count IV Objects to Defendant’s Claim. 

The Complaint alleges that Starr and Debtor entered into a Strategic Alliance 

Agreement (“SAA”) on January 8, 201312. Pursuant to the SAA, Starr was 

of the case, and obtains, at such time and with respect to such credit, an execution against the 

debtor that is returned unsatisfied at such time, whether or not such a creditor exists; or (3) a 

bona fide purchaser of real property, other than fixtures, from the debtor, against whom 

applicable law permits such transfer to be perfected, that obtains the status of a bona fide 

purchaser and has perfected such transfer at the time of the commencement of the case, whether 

or not such a purchaser exists.

(b)(1) Except as provided in paragraph (2), the trustee may avoid any transfer of an interest of 

the debtor in property or any obligation incurred by the debtor that is voidable under applicable 

law by a creditor holding an unsecured claim that is allowable under section 502 of this title or 

that is not allowable only under section 502(e) of this title...” 11 U.S.C. §544.

9

“(a) Except as otherwise provided in this section, to the extent that a transfer is avoided under 

section 544, 545, 547, 548, 549, 553(b), or 724(a) of this title, the trustee may recover, for the 

benefit of the estate, the property transferred, or, if the court so orders, the value of such 

property, from— (1) the initial transferee of such transfer or the entity for whose benefit such 

transfer was made; or (2) any immediate or mediate transferee of such initial transferee.” 11 

U.S.C. §550(a).

10 “(1) In an action for relief against a transfer or obligation under ss. 726.101-726.112, a creditor, 

subject to the limitations in s. 726.109 may obtain: (a) Avoidance of the transfer or obligation to 

the extent necessary to satisfy the creditor’s claim; (b) An attachment or other provisional remedy 

against the asset transferred or other property of the transferee in accordance with applicable 

law; (c) Subject to applicable principles of equity and in accordance with applicable rules of civil 

procedure: 1. An injunction against further disposition by the debtor or a transferee, or both, of 

the asset transferred or of other property; 2. Appointment of a receiver to take charge of the asset 

transferred or of other property of the transferee; or 3. Any other relief the circumstances may 

require.

(2) If a creditor has obtained a judgment on a claim against the debtor, the creditor, if the court 

so orders, may levy execution on the asset transferred or its proceeds.” Fla. Stat. §726.108

11 “(2) Except as otherwise provided in this section, to the extent a transfer is voidable in an 

action by a creditor under s. 726.108(1)(a), the creditor may recover judgment for the value of 

the asset transferred, as adjusted under subsection (3), or the amount necessary to satisfy the 

creditor’s claim, whichever is less. The judgment may be entered against: (a) The first transferee 

of the asset or the person for whose benefit the transfer was made; or (b) Any subsequent 

transferee other than a good faith transferee who took for value or from any subsequent 

transferee.” Fla. Stat. §726.109(2).

12 As amended on March 28, 2013. 

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required to provide various consulting services to Debtor. The Complaint alleges 

that these services included helping Grandparents.com with: (i) development of 

a strategic business model and investment relationships; (ii) development of a 

comprehensive business plan; (iii) negotiation of favorable agreements with 

insurance carriers; (iv) development of insurance products specifically targeted 

to Debtor’s target customer demographic; and (v) exploring the potential of 

Debtor forming a joint insurance carrier. These services were to be provided by 

specified members of Starr senior management. 

The Complaint further alleges that, in exchange for these services, the Debtor 

agreed to pay Starr $80,000 a month plus a consulting fee if certain benchmarks 

were met. In addition to the monetary payments, Starr also received a five year 

stock warrant to purchase common shares of stock in Grandparents.com equal 

to 25% of the outstanding equity of Grandparents.com. The Complaint alleges 

that Debtor paid Defendant, in addition to the warrants, a total of $2,160,000.00 

within four years of the Petition Date (the “Payments”). The Complaint states that 

the Debtor was insolvent or inadequately capitalized at the time these transfers 

occurred. The Complaint further alleges that the Debtor’s liabilities exceeded its 

assets each year, from 2013 through 2016, referencing the Debtor’s financial 

records, 10-K tax filings, and stating precise amounts of liabilities for each year 

(in excess of $1,750,000 for each year from 2014-2016). 

The Complaint alleges that the Debtor did not receive reasonably equivalent 

value for these payments, because the staffing on the Debtor’s account was 

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reduced from four individuals to one individual who was not part of Starr’s senior 

management; that Starr did not provide the requisite level of service; and that 

the value of the services actually provided by Starr were less than contemplated 

in the SAA and were less than the reasonably equivalent value of the dollars paid 

by the Debtor for those services. The operative documents upon which the 

Plaintiff relies are the SAA and its First Amendment.13

The Defendant filed its Motion to Dismiss on September 30, 2019. Starr 

asserts that the Complaint should be dismissed pursuant to Fed.R.Civ.P. 8(a)

and Fed.R.Civ.P. 12(b)(6)14 because the Complaint fails to adequately plead the 

relief to which the Plaintiff claims he is entitled. For the reasons set forth below, 

the Court grants the Motion to Dismiss Count II of the Complaint, and denies 

the Motion to Dismiss Counts I, III and IV of the Complaint.

III. Conclusions of Law

A. Legal Standard

“Federal Rule of Civil Procedure 8(a)(2) requires only ‘a short and plain 

statement of the claim showing that the pleader is entitled to relief,’ in order to 

‘give the defendant fair notice of what the . . . claim is and the grounds upon 

which it rests. While a complaint attacked by a Rule 12(b)(6) motion to dismiss 

does not need detailed factual allegations, a plaintiff's obligation to provide the 

13 Exhibits A and B to the Complaint.

14 Fed.R.Civ.P. 8 is made applicable to this adversary proceeding pursuant to Fed.R.Bankr.P. 

7008 and Fed.R.Civ.P. 12(b)(6) is made applicable to this proceeding through Fed.R.Bankr.P. 

7012.

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‘grounds’ of his ‘entitle[ment] to relief’ requires more than labels and conclusions, 

and a formulaic recitation of the elements of a cause of action will not do. Factual 

allegations must be enough to raise a right to relief above the speculative level 

on the assumption that all the allegations in the complaint are true (even if 

doubtful in fact).” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555-56 (2007) 

(internal citations omitted).

To survive a motion to dismiss, the complaint must “state a claim to relief 

that is plausible on its face.” Id. at 570. “A claim has facial plausibility when the 

plaintiff pleads factual content that allows the court to draw the reasonable 

inference that the defendant is liable for the misconduct alleged. Ashcroft v. 

Iqbal, 556 U.S. 662, 678 (2009).

On a motion to dismiss, a court must construe the complaint in the light most 

favorable to the plaintiff and accept the plaintiff’s factual allegations as true. 

Brooks v. Blue Cross & Blue Shield of Fla., Inc., 116 F.3d 1364, 1369 (11th Cir. 

1997). “The scope of review on a motion to dismiss under Rule 12(b)(6) is limited 

to the four corners of the complaint.” Bencomo Enterprises v. United Specialty 

Ins. Co., 345 F. Supp. 3d 1401, 1404 (S.D.Fla. 2018).

B. Legal Analysis

Existence of a contract does not bar a claim for constructive fraud

The Defendant argues that the Plaintiff’s constructive fraud case is just a 

breach of contract claim in disguise, and that, because the Debtor never gave 

Starr notice and an opportunity to cure any alleged contract default, the claim 

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is barred. Moreover, the Defendant argues, a breach of contract claim can never 

give rise to a fraudulent conveyance claim because all of the money paid by the 

Debtor was paid pursuant to a valid contract and payment under a contract 

always constitutes reasonably equivalent value - the payment is made pursuant 

to a bargained for exchange. Thus, the Defendant argues, unless the contract 

itself is set aside as a fraudulent transfer (relief not sought and timebarred by 

the Plaintiff in this adversary proceeding), payments under the contract cannot 

be avoided as constructively or actually fraudulent. 

The existence of a binding contract does not foreclose a fraudulent 

conveyance claim if the elements of the cause of action for constructive fraud are 

met. “A transfer may be fraudulent even if it is made in accordance with the 

terms of a contract.” EBC I, Inc. v. America Online, Inc. (In re EBCI I Inc.), 356 

B.R. 631, 640 (Bankr.D.Del. 2006). See also United States v. S. Capital 

Construction Inc., 758 Fed. Appx. 676, 679 (11th Cir. 2018)( affirming trial court’s

finding that a spouse, who was labelled president, CEO, and director of an entity,

received actual and constructive fraudulent transfers more than $650,000 where 

the spouse had little entity involvement and provided no services for the 

payments); Mellon Bank, N.A. v. Official Comm. Of Unsecured Creditors of R.M.L. 

(In re R.M.L.), 92 F.3d 139, 147-48 (3rd Cir. 1996)(court upheld lower court 

judgment that payment for a loan commitment letter was recoverable as a 

fraudulent conveyance. “Because the commitment letter was so conditional that 

the chances of the loan closing were minimal, we agree that [the debtor] did not 

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receive value that was reasonably equivalent to the fees it paid Mellon Bank.”).

A transfer made under the terms of a contract is not always for 

“reasonably equivalent value”

A transfer made pursuant to a contract may still be avoidable as a fraudulent 

transfer if the evidence demonstrates the exchange is not for reasonably 

equivalent value. Despite the Defendant’s arguments to the contrary, whether a 

transfer is made pursuant to the terms of a contract is not necessarily dispositive 

of the issue. If that were the case then any payment that is otherwise 

constructively or actually fraudulent would be insulated by the existence of a 

contract. See Kipperman v. Onex Corp., 411 B.R. 805, 853 (N.D. Ga. 2009)(In an 

order denying defendants’ motion for summary judgment the district court ruled 

that whether the defendants provided reasonably equivalent value to the debtor 

with respect to payments made for services to be provided under the terms of a 

management agreement created material issues of fact; the trustee plaintiff was 

not barred as a matter of law from bringing the claim.) See also Mellon Bank, 

N.A. V. Committee, 92 F.3d at 142; EBC 1, Inc. v. Am. Online, Inc. (In re EBC 1, 

Inc.), 356 BR. at 638 (“[T]here is nothing in section 548 to suggest that executory 

contracts or terminated contracts are not subject to its provisions.”).

The Court recognizes that the definition of value in section 548(d)(2) includes 

“satisfaction or securing of a present or antecedent debt of the debtor”, and that 

this definition has led many courts to hold that “the satisfaction or partial 

satisfaction of a debt constitutes reasonably equivalent value for purposes of 

determining whether a transfer was constructively fraudulent.” In re VillamontCase 19-01289-LMI Doc 53 Filed 04/10/20 Page 9 of 15
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Oxford Assoc. Ltd. P’ship, 236 B.R. 467, 481 (Bankr.M.D.Fla. 1999). See Cox v.

Nostaw, Inc. (In re Central Illinois Energy Cooperative), 526 B.R. 786, 791 

(Bankr.C.D.Ill. 2015)(The payment of obligations under a contract discharge the 

obligation under the contract and therefore “are, by definition, for reasonably 

equivalent value.”). However, the Court does not find these two concepts 

mutually exclusive. In general, satisfaction of a contract obligation in accordance 

with the terms of the contract will constitute reasonably equivalent value. But 

just like payment for services under a contract do not always bar a claim for 

breach of contract, neither does it necessarily bar a claim for constructive fraud, 

if the plaintiff proves the elements of that cause of action. And based on the case 

law that is discussed in this opinion, the payment of a contract obligation under 

a contract does not, as a matter of law, bar a claim for constructive fraud.15

Because the existence of a contract does not preclude a claim for constructive 

fraud the various defenses raised in the Motion to Dismiss to enforcement of the 

contract

16 are not applicable. The only defenses that are relevant are those 

relating to the statutory claims.

A constructive fraud claim is not barred by the independent tort rule

The Defendant also argues that constructive fraud is essesntially a tort, and 

therefore, under the independent tort doctrine, or the economic loss rule the 

15 To the extent that there is a split in the case law on this issue, the Court finds that those cases 

recognizing the possibility of a fraudulent conveyance claim notwithstanding an enforceable 

contract to be the better reasoned.

16 These include failure to provide notice and an opportunity to cure and acceptance of services.

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Plaintiff is barred from seeking redress outside of a breach of contract claim.

The claims raised are not barred by the independent tort rule. The 

independent tort rule requires that “ in order to bring a valid tort claim, a party 

still must demonstrate that all of the required elements for the cause of action 

are satisfied, including that the tort is independent of any breach of contract 

claim.” Tiara Condominium Association, Inc., 110 So.3d 399, 408 (Fla. 

2013)(Pariente concurrence)(citing Lewis v. Guthartz, 428 So.2d 222, 224 (Fla. 

1982).

17,18

First, statutory claims are not tort claims. Accord Citizens Property Ins. Corp. 

v. Perdido Sun Condominimium Ass’n, Inc., 164 So.3d 663 (Fla. 2015)(statutory 

bad faith action is not a tort);

19 Brown v. Nova Info. Sys., Inc., 903 So. 2d 968, 

969 (Fla. 5th DCA. 2005)(conspiracy to violate Florida’s Uniform Fraudulent 

Transfer Act is not a tort giving rise to jurisdiction under the long arm statute.)

Second, even if statutory fraud claims were tort claims, the statutory elements 

of the claims are distinct from the elements for breach of contract. See Cohen v. 

17 The parties conflate the independent tort rule with the economic loss rule. The economic loss 

rule is “a judicially created doctrine that sets forth the circumstances under which a tort action 

is prohibited if the only damages suffered are economic losses.” Tiara Condominium at 402. 

However, in Florida, the economic loss rule only applies in the products liability context. Id at 

407.

18 An example would be fraud in the inducement, see, e.g., HTP, Ltd. v. Lineas Aereas 

Costarricenses, S.A., 685 So.2d 1238 (Fla.1996), or negligent misrepresentation, see, e.g., U.S. 

Fire Insurance Co. v. ADT Security Services, Inc., 134 So.3d 477 (Fla. 2d DCA 2013).

19 Even prior to limitation of the economic loss rule to products liability actions, the Florida 

Supreme Court made clear that statutory causes of action are never barred by the economic loss

rule. Comptech Int’l, Inc. v. Milam Commerce Park, Ltd., 753 So.2d 1219 (Fla. 1999); Invo Florida 

v. Somerset Venturer, Inc., 751 So.2d 1263 (Fla. 3d DCA 2000).

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Ernst & Young, LLP (In re Friedman’s Inc.), 327 B.R. 530, 546-47 (Bankr.S.D.Ga. 

2007)(The mere “fact that a fraudulent conveyance claim may arise out of a 

common set of facts in which the elements of a breach of contract claim might 

also exist does not prevent the Trustee from pleading both claims in his 

complaint.” . . . “the facts arguably support both a breach of contract action and 

a fraudulent conveyance action.”Id.). That the same operative facts may give rise 

to more than one cause of action does not preclude a plaintiff seeking relief under 

more than one theory. See Sun Life Assurance Company of Canada v. Imperial 

Premium Finance, LLC, 904 F.3d 1197, n. 16 (11th Cir. 2018); see also

Fed.R.Civ.P. 8(a)(3) and 18(a) as incorporated by Fed.R.Bankr.P. 7008 and 7018, 

respectively.

A triggering creditor must be specifically identified

The Defendant argues that the Plaintiff is not entitled to relief under Count II 

of the Complaint because the Defendant has failed to identify a triggering 

creditor. The Defendant is correct that, if the relief the Plaintiff seeks requires a 

triggering creditor, the Plaintiff has not met the requirements of Rule 12.20 

The Complaint alleges that “Grandparents.com’s liabilities exceeded its assets 

every year as follows...” and included specific references to the assets and 

liabilities of the Plaintiff for the years stretching from 2013-2016. The Complaint 

20 The Complaint does not specify under which section of 544 the Plaintiff is seeking relief. 

Section 544(a) does not require a triggering creditor, because, as the statute specifically states, 

the trustee steps into the shoes of a creditor “whether or not such a creditor exists.” 11 U.S.C. 

§§544(a)(1) and (a)(2). However, based on the context of the Complaint and the arguments, the 

Court believes the Plaintiff is proceeding under section 544(b).

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further alleges that during each of the years relevant to the allegations in the 

Complaint, the Debtor’s liabilities exceeded its assets, the precise amounts of 

the liabilities, and that the liabilities are taken from Debtor’s financial records, 

including its 10-K tax filings. Thus, the Plaintiff argues, the Court is able to 

draw the reasonable inference that there existed at least one creditor, because –

by definition – liabilities equal creditors, and thus by alleging the factual 

existence and reporting of such liabilities the Trustee has alleged the existence 

of creditors. 

That is all true. However, 

[w]hile a number of courts previously ruled that it was not necessary 

to name specific triggering creditors, in light of the Supreme Court's 

rulings in Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 173 

L.Ed.2d 868 (2009) and Bell Atl. Corp. v. Twombly, 550 U.S. 544, 

127 S.Ct. 1955, 167 L.Ed.2d 929 (2007), it is now necessary to 

include specific allegations to support this element of the claim. The 

plaintiff must name a specific [triggering] creditor or creditors. It is 

not sufficient to merely draw the Court's attention to the schedules 

of liabilities filed in a case, particularly if this is done only in 

connection with a motion to dismiss and not in the complaint itself.

Furr v. TD Bank, et al. (In re Rollaguard Security, LLC), 570 B.R. 859, n.11 

(Bankr.S.D.Fla. 2017). See also Baskt v. Bank Luemi, USA (In re D.I.T., Inc.), 

561 B.R. 793, 800 (Bankr.S.D.Fla. 2016)(finding that the complaint 

adequately identified triggering creditors, “Plaintiff identifies by name 

several creditors with allowable unsecured claims who could have sought 

avoidance of the transfers to [the bank]”); Andrews v. Graham Holding 

Company, Inc., et al. (In re Graham Gulf, Inc.), 2018 WL 10345330, *5

(Bankr.S.D.Ala. 2018)(explaining the requirement that a “specific

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triggering creditor [must be] identified for each alleged transfer”) (internal 

citations omitted).

Count III: Recovery Pursuant to 11 U.S.C. §550 and Fla. Stat 

§§726.108 and 726.109

The Defendant seeks dismissal of Count III of the Complaint, on the basis 

that the Trustee has neither adequately plead a lack of reasonably equivalent 

value and nor shown the avoidability of the Transfers. Because the Court has 

not dismissed Count I of the Complaint, Count III is not dismissed.

Count IV: Objection to Defendant’s Proof of Claim

11 U.S.C. §502(d) explicitly states “the court shall disallow any claim of any 

entity from which property is recoverable [for an avoidance action]”. Id. Because 

the Court has not dismissed Count I, the Objection to Claim is not subject to 

dismissal at this juncture. However, the objection to claim also alleges that “due 

to its holdings and involvement with Grandparents.com, Starr may be 

considered an insider of Grandparents.com”. Other than this one statement, the 

Complaint does not state why the Defendant would be considered an insider of 

the Debtor, and the Plaintiff has not cited any legal or factual support for this 

statement. Accordingly, any objection to claim based on the Defendant’s alleged 

insider status is stricken.

IV. Conclusion

In conclusion, the Trustee has plead sufficient facts to withstand the 

Defendant’s Motion to Dismiss with respect to Count I of the Complaint, and 

therefore the Motion is DENIED with respect to Counts I, III and IV. However, 

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the Trustee has failed to plead sufficient facts with respect to Count II of the 

Complaint and therefore the Motion to Dismiss is GRANTED with respect to 

Count II of the Complaint.21

The Plaintiff will have fourteen days to file an Amended Complaint that 

specifically identifies the triggering creditors upon which Plaintiff is relying in 

support of the relief sought with respect to Count II of the Complaint. No other 

amendments are permitted. If the Plaintiff does not file an Amended Complaint 

as to Count II then the Defendant shall file an answer within thirty (30) days of 

the date of this Order. 

If the Plaintiff files an Amended Complaint with respect to Count II then the 

Defendant shall have twenty-one (21) days from the date the Amended Complaint 

is filed to file an answer to the Amended Complaint.

# # #

Copies furnished to:

Marty Steinberg, Esq.

Attorney Steinberg shall serve a copy of this Order on all interested parties 

and file a certicate of service.

21 This opinion is limited to the quality of the pleading for purposes of withstanding the Motion 

to Dismiss. 

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