While it is not common practice some chapter 11 cases have trustees appointed. A recent decision from the 4th Circuit goes into the appointment of a trustee. (In re TP, Inc.) In that case the creditors convinced the court that the company had been mismanaged and the Debtor-In-Possession failed to properly file monthly reports or otherwise cooperate with the U.S. Trustee or creditors. Let this be a warning that if you choose to file for chapter 11 protection you should be ready to do what is required to stay in the chapter 11.
Wednesday, May 18, 2011
All throughout Florida there has been a string of hotels and motels filing for Chapter 11 protection. In the north Florida area over 10 have filed since January. It is hard to put your finger on one reason why this is happening but anyone can see that the economy is hitting this industry hard. This is not even considering the small bed & breakfast inns all around the area that have seen a sharp decrease in visitors. In my opinion the area is going to see even more hotels, motels, and inns seeking bankruptcy protection in the near future.