Is The Public Informed Of The Filing Of A Chapter 11 Bankruptcy Case?
The public is not informed of a Chapter 11 filing unless the debtor is a large corporation. Then it will undoubtedly be reported, both on television and in the newspapers. Smaller cases are less likely to be reported in any sort of public media because they are of little interest to the general public. However, anytime a bankruptcy case is filed, the record is public. This means that any person can look up the case at the Bankruptcy Court and search through the documents there to learn of the filings in that particular case. But it is unlikely that anyone other than a bankruptcy attorney will look up a case up.
Does A Person Or Business Filing Under Chapter 11 Bankruptcy Have To Continue To Pay Its Debts After The Case Is Filed?
The day that we file a bankruptcy petition is called a petition date. Anything prior to that is prepetition and anything after that is postpetition. The debtor does not make payments on prepetition obligations until the plan is confirmed. The plan will contain the terms under which those prepetition obligations are paid. As for ongoing postpetition obligations, the debtor does make payments on those. For example, if the debtor has a mortgage, the debtor must make the pos-petition mortgage payments as they become due. The debtor must make those payments on-time. If the debtor has a prepetition arrearage, then the prepetition arrearage goes into the plan and will not be paid until after the Court confirms the plan.
What Is An Interest Holder And What Is Its Role In A Chapter 11 Bankruptcy Case?
A creditor is someone to whom the debtor owes money. An interest holder is someone who has an interest in the debtor.
You might argue that if the debtor incurred debt on a credit card issued by a bank, then the bank is an interest holder. However, the bank is a creditor, and not an interest holder.
Interest holders are typically equity security holders — the shareholders — and in that capacity they have an interest in the business.
While there may be a debt that is owed to an interest holder, making that interest holder a creditor as well, “creditor” and “interest holder” are not synonyms. For example, a shareholder — i.e., an interest holder — could also be an employee who is owed back wages, and is thus a creditor.
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