There are times when companies may file for bankruptcy under one Chapter but will later convert it to another. That is what happened for a regional airline that announced its bankruptcy filing just a few months ago. What started as a Chapter 11 reorganization filing has now been converted into a Chapter 7 liquidation bankruptcy filing, also known as “straight bankruptcy”. The expedited motion was heard by a federal court judge last week in Massachusetts. The trustee appointed to the case reviewed the terms of the bankruptcy with the judge and explained why Chapter 7 bankruptcy would be more beneficial for most of the parties involved in the filing.
Based on the terms of the bankruptcy, the Myrtle Beach-based airline will no longer be considered a business. The profits of the company’s liquidation will be divided up amongst the approved creditors on the filing. The airline’s lawyers state that while most of the creditors will receive some funds, they will only be a fraction of what they are actually owed. Do you want to move forward with Chapter 7 in San Antonio but have questions? If so, get answers today by contacting the Malaise Law Firm to schedule a case evaluation with a San Antonio bankruptcy attorney from our team.