Delaware Bankruptcy Court Grants Derivative Standing to Creditors' Committee of Debtor LLC

Bankruptcy, Restructuring and Creditors' Rights attorneys Heather Cantu Montoya, Lisa Kim and Barbra Parlin co-authored an article in Pratt's Journal of Bankruptcy Law discussing the Pack Liquidating decision from the U.S. Bankruptcy Court for the District of Delaware. The court found that in cases where debtors are limited liability companies (LLCs), bankruptcy courts are able to grant derivative standing to creditors' committees affirming claims that belong to the estate. The precedent established by this decision could alter the landscape for committees and expose LLC managers and other involved parties to potential liability issues.

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