Chapter 7 Liquidation

Our firm represents parties on all sides of Chapter 7 liquidation cases, including serving as and representing trustees, pursuing claims on behalf of landlords and creditors, and advising business debtors through the Chapter 7 process.

Chapter-7 Debtors & Creditors

Chapter 7 Trustee Work

SulmeyerKupetz partners Howard Ehrenberg and Elissa Miller are members of the Chapter 7 Bankruptcy Panel of Trustees for the Central District of California, appointed by the Office of the United States Trustee. As such, they have overseen thousands of liquidations, ensuring proper distribution of assets and maximizing the value of bankruptcy estates in industries from entertainment to healthcare. These matters have included:

  • Coordinated litigation of complex claims against entertainment payroll company worth $2 billion, involving multiple law firms and accounting firms.
  • Recovered $24 million fraudulent conveyance in bankruptcy of private estate.
  • Handled complex litigation matters, including municipal matters, as trustee for the lessee/operator of the Queen Mary Hotel and Tourist Destination. Secured $43 million sale of 66-year lease.
  • Pursued claims by victims of hedge fund Ponzi scheme as Chapter 7 trustee, resulting in recovery of $10 million for the benefit of creditors.
  • As counsel to trustee, determined and implemented litigation strategy against principal, buyer, and customer of $100-million apparel company, alleging the three engaged in a “bust-out” of debtor’s business.
  • Coordinated with counsel and forensic accountants to evidence elaborate scheme in which principal and several former customers stole inventory from Korean textile import company.
  • Successfully obtained title and secured sale of two lots worth $44 million as trustee in bankruptcy of West Covina auto dealerships.

Representation of Chapter 7 Trustees

Our lawyers also represent bankruptcy trustees toward enforcing their rights in maximizing the value of bankruptcy estates, including filing suit and managing litigation as appropriate. SulmeyerKupetz has worked on behalf of Chapter 7 trustees in such cases as described below:

  • Enforced trustee’s rights to recover in matter that resulted in incarceration of debtor who transferred $1.4 million to shell companies he owned.
  • Successfully filed motion for summary judgment following avoidance action and constructive fraudulent transfer action on behalf of Chapter 7 trustee.
  • Representing Chapter 7 trustee in recovery of homestead exemption through contempt proceedings and subsequent appeal.
  • Asserting company’s rights against the principal of an art business on behalf of Plan Agent, after allegations of misappropriated work led the business into bankruptcy. Brought litigation for recovery of fraudulent transfers.
  • Leading suit to reclaim assets moved by proprietor of defunct restaurant to a separate business, on behalf of bankruptcy trustee.
  • Representing trustee in relation to Chapter 7 matter seeking to recover $450,000, the proceeds of property sold by the debtor while under bankruptcy protection.
  • Served as counsel to Chapter 7 trustee for Philmar Care, which owned and operated 204-bed skilled nursing facility (SNF). Negotiated and obtained court approval of management and operations transfer agreement and separate purchase agreement that allowed license to be transferred to new operator and which prevented the facility from being closed. Represented trustees and successfully transitioned insolvent facilities to new ownership in two other similar skilled nursing facility matters.
  • Handled disputes with the City of Long Beach on behalf of bankruptcy trustee for the Queen Mary hotel and tourist destination. The property, including forty acres surrounding the ship, was sold at auction to a new developer for $43 million.
  • Assisted in sale of several properties at a value of roughly $40 million in relation to six real estate entities under Chapter 11, which were jointly owned by two partners in dispute.
  • Created plan of liquidation, which was confirmed by the bankruptcy court, for trustee in matter involving large medical building, allowing trustee to continue liquidating receivables valued at approximately $40 million.
  • Represented bankruptcy trustee in relation to two skilled nursing facilities (SNFs), preserving operations while new management was acquired for the benefit of residents and simultaneously acting in the best interests of creditors.
  • Representing trustee of Girardi Keese, one of the most prominent personal injury and mass tort law firms in the country, including investigating and commencing lawsuits to avoid and recover preferential or fraudulent transfers made by the firm to its creditors or other third parties in an effort to bring value to the firm’s creditors.

Chapter 7 Debtors, Creditors, and Other Parties

Our firm additionally represents debtors and creditors, as well as landlords and other parties, in relation to Chapter 7 bankruptcies. Examples of our past work in this area include:

  • Represented owner of commercial building in Downtown L.A., which brought in approximately $40,000/month in rent, opposite tenant that had commenced bankruptcy case.
  • Assisted client undergoing Chapter 7 bankruptcy in selling equity in extensive collection of artwork, including identifying and valuing more than 600 pieces of art.
  • Represented recycling business in contentious meetings with creditors during Chapter 7. Coordinated over a period of several months with Chapter 7 trustee to liquidate significant real estate assets.
  • Defended debtor clients in significant discharge and non-dischargeability proceedings.

Lawyers to Contact:

To find out how we can help you navigate the Chapter 7 process, please contact our firm by calling the office at 213.626.2311 or by emailing the attorneys below.