If you received payments from a now bankrupt entity during the preference period, you may be subject to a Preference Action seeking recovery of all payments during that period. The preference period is most commonly 90 days prior to the date the bankruptcy was filed. While there are defenses, many businesses that receive a Preference Action fail to respond. This may be for a variety of reasons, but most commonly, many businesses do not realize that they have been served. These actions may be served by First Class Mail and there is national service and jurisdiction. Failure to respond to a Preference Action results in a default judgment, which may then be enforced against you. If you receive a pleading by mail from a bankruptcy court that seeks recovery of payments, please do not ignore it; rather, seek the advice of counsel promptly to avoid any unfortunate and expensive surprises down the road.