A wholesale power company’s bankruptcy filing is under constant scrutiny by several outside sources. One of the sources, a “watchdog” group for government bankruptcy filings, is calling for an independent trustee to take control of the bankruptcy filing. Based on its report, a federal judge has stalled the proceedings that would have announced whether the bankruptcy plan was approved or denied. The judge instead ordered a mediator to step in to work out a new restructuring deal between the company and its creditors.
The watchdog group uncovered what it believes to be a “fraudulent transfer” of assets. A transfer was allegedly made before the company filed for bankruptcy which was intended to protect shareholders from losing assets. The report goes on to say that since the company has shown “breaches of duty of the various boards” overseeing the bankruptcy, an independent trustee should be brought in to provide a fair and balanced analysis of the company’s current holding and financial prospects. As you can see, filing for Chapter 11 bankruptcy is never straight-forward. For this reason, business owners should contact the Malaise Law Firm to get representation from an experienced San Antonio bankruptcy lawyer.