Atlantic City isn’t the only place where the gambling industry has collapsed, and the host area may well collapse along with it.
Lawyers for Caesar’s Palace in Las Vegas are scheduled to be back in an Illinois courtroom to explain why their client refuses to consent to an involuntary bankruptcy petition. According to the Committee of Unsecured Creditors in the involuntary Chapter 11 proceeding, Caesar’s Entertainment Operating Company (CEOC) has a “statutory duty” to consent to the proceeding.
This is the case of the dueling bankruptcies. CEOC filed a voluntary Chapter 11 petition on January 15 in Chicago, three days after junior lenders filed an involuntary Chapter 11 in Delaware. Roughly $500 million in cash is at stake, and if the junior lenders win this hearing, they get the money.
A little over a hundred years ago, after the state’s silver mines played out, Nevada was so broke that there was talk of merging it with California or Arizona. CEOC is probably just the first domino to fall in Las Vegas, so that talk may soon resurface.
But, back to Camden. A typical Chapter 7 bankruptcy may take about six to nine months, from start to finish. Of course, not all cases are typical. Generally, however, the case goes something like this:
- Voluntary Petition: Since no one forces the debtor to go to court, this petition can usually be amended or withdrawn at almost any time. Involuntary petitions are not uncommon in business proceedings, if the creditors feel the business has money to pay its debts but is refusing to do so.
- Motion to Lift Stay: Occasionally, a creditor will seek special permission from the judge to ignore the automatic stay and foreclose on a lien. These motions are only filed when payments haven’t been made on a car loan or mortgage.
- Notice: All creditors must receive notice of the proceeding. This process is largely mechanical.
- 341: The “meeting of creditors” is really nothing of the sort, because moneylenders very rarely show up. In a Chapter 7, the debtors must typically furnish some documents, like recent tax returns, verify their identities, and answer a few yes/no questions from their attorneys.
- Discharge: After the trustee is satisfied that everything is in order, the judge signs an order forgiving all unsecured debts. The debtors now have their fresh starts.
Additionally, the debtors must complete two counselling courses. One must be done prior to filing, and the other must be completed prior to discharge. These classes can usually be taken online.
Contact John Hargrave and Associates
We have provided comprehensive counsel to individuals in and around Barrington, New Jersey, since 1977. To schedule a free initial consultation, contact our office by e-mail or call us at 856-547-6500