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Trustee Rights and Obligations When Debtor's Ch. 11 Case Converts to Ch. 7

U.S. Bankruptcy Court for the District of Delaware court held that a Chapter 7 trustee was bound by the pre-conversion actions of the debtors, and that the trustee would not be permitted to step into the shoes of the then-dissolved official committee of unsecured creditors to pursue certain causes of action.

9 minute read August 01, 2021 at 12:03 AM
By
Rudolph J. Di Massa Jr. and Drew S. McGehrin
Trustee Rights and Obligations When Debtor's Ch. 11 Case Converts to Ch. 7

As a continuation of the ongoing disputes that began with a challenged "structured dismissal" in the Jevic Holdings Corp. bankruptcy case, the U.S. Bankruptcy Court for the District of Delaware recently rendered a decision addressing the rights and obligations of a trustee who has been appointed after a debtor's Chapter 11 case converts to one under Chapter 7 of the Bankruptcy Code.

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