Chapter 11 - Lawsuit Settlement
My question involves bankruptcy in the state of: FL
I in a limited partnership with one assets (an investment in another company). It has no cash and a bunch of debts (some third-party but mostly me or family). The company is in a nasty lawsuit as the plaintiff and subject to a counter claim now. The judge as ordered mediation and has required in-person attendance. Nobody wants to go for free and pay thier own way. The limited partners also don't want to chip in for a trial. Good money after bad logic. Thus, is it best to file for Chapter 11 now or is it best to settle with them (give them some of the stock it owns in the other company) and then file for Chapter 11 within 90 days a avoid the settlement as a preference. The company need to go into bankrutcy (11 or 7) at some point so any thoughts on the best strategy.
Thanks.
Re: Chapter 11 - Lawsuit Settlement
You should discuss the specifics of the case with the lawyer who would be handling the bankruptcy. The lawsuit is an asset of the partnership. The counter-claim, if it has been filed, is a potential liability.