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A company that I do business with is about to file Chapter…

A company that I do...
A company that I do business with is about to file Chapter 7.
They are currently liquidating their inventory to pay off the first lien lender.
They still owe me money for shipments that I have made them.
The company is a Delaware Company.

Does that mean that they must file in Delaware?
Do I need to hire a lawyer to represent me in the creditors committee to get paid back money? Or will the company send out a list of creditors and I just need to verify the amount?
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Answered in 9 minutes by:
1/22/2014
WALLSTREETESQ
WALLSTREETESQ, Attorney
Category: Bankruptcy Law
Satisfied Customers: 17,267
Experience: 14 years exp., CH 7 AND 13 Bankruptcy cases, AFL-CIO UNION PLUS, UFT NYSID AND ALL MAJOR UNIONS
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WALLSTREETESQ :

This is a common situation,

WALLSTREETESQ :

you would not need to hire an attorney, if they file bankruptcy you would receive a notice to file or contest,

WALLSTREETESQ :

you would want to file a proof of claim form,

WALLSTREETESQ :

to add your name to the list of creditors that would be paid through the bankruptcy,

WALLSTREETESQ :

If you feel they are hiding assets, you can hire an attorney to contest the discharge,

WALLSTREETESQ :

The cost of such action would make it prohibitive unless you feel the debtor has money to pay your claim, and is not disclosing it.

WALLSTREETESQ :

A corporation is entitled to file for bankruptcy in the judicial district where its principal place of business is located, or in the state of its incorporation. It would be rare for them to file it in DE, due to the distance and extra expense.


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Customer reply replied 4 years ago

How do I form a creditors committee?


Me and two other creditors are the largest suppliers.

If they file a chapter 11 reorganization, you have the ability to form a creditors meeting, in a chapter 7 the corporation would receive a discharge through the trustee who is appointed.

If a chapter 11 is filed all creditors would be required to come to Court to form the committee.
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Customer reply replied 4 years ago

If they file chapter 7, is there a way to question what they are doing? Any meetings we can attend? or just hope the judge (trustee) does the right thing?

You would have the right to attend the 341 meeting of creditors, and contest his discharge and petition, you can also question his assets, and file any motions you wish contesting the discharge.
WALLSTREETESQ
WALLSTREETESQ, Attorney
Category: Bankruptcy Law
Satisfied Customers: 17,267
Experience: 14 years exp., CH 7 AND 13 Bankruptcy cases, AFL-CIO UNION PLUS, UFT NYSID AND ALL MAJOR UNIONS
Verified
WALLSTREETESQ and 87 other Bankruptcy Law Specialists are ready to help you
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Customer reply replied 4 years ago

Will I need a lawyer for contesting the discharge?

At that point you should have a creditors attorney to handle the case.
WALLSTREETESQ
WALLSTREETESQ, Attorney
Category: Bankruptcy Law
Satisfied Customers: 17,267
Experience: 14 years exp., CH 7 AND 13 Bankruptcy cases, AFL-CIO UNION PLUS, UFT NYSID AND ALL MAJOR UNIONS
Verified
WALLSTREETESQ and 87 other Bankruptcy Law Specialists are ready to help you
Ask your own question now
Customer reply replied 4 years ago

So, now the company is not going to file bankruptcy.


They said in an 8K that they have reached an agreement and are going to agree to the bankers default agreement. SO now they are going to liquidate the assets and give the proceeds to the bank.


They said the shareholders will not get any money, and have not told us creditors anything.


Should we force the company into bankruptcy to get judge supervision and that will aloow us to find out details.?

At this point that may be the best protection and only alternative for the creditors.
WALLSTREETESQ
WALLSTREETESQ, Attorney
Category: Bankruptcy Law
Satisfied Customers: 17,267
Experience: 14 years exp., CH 7 AND 13 Bankruptcy cases, AFL-CIO UNION PLUS, UFT NYSID AND ALL MAJOR UNIONS
Verified
WALLSTREETESQ and 87 other Bankruptcy Law Specialists are ready to help you
Ask your own question now
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