United States Sixth Circuit

In litigation arising from an amended petition for involuntary bankruptcy filed by plaintiffs, dismissal of the petition due to a lack of a sufficient number of qualified creditors under 11 U.S.C. section 303(b)(1) is affirmed where: 1) debtor's settlement with an entity did not moot the appeal; 2) the bankruptcy court did not err in establishing and enforcing its joinder deadline; and 3) the bankruptcy court did not err in holding that plaintiffs were not qualified petitioning creditors under section 303(b)(1). While 11 U.S.C. section 303(c) allows joinder "before a case is dismissed or relief is ordered," the statute does not prohibit a court from setting a deadline for creditors to join an involuntary petition, based upon the court's case management authority, in order to ensure orderly, fair, and efficient proceedings.

Appellate Information

• Decided 05/23/2007
• Published 05/23/2007

Judges

• Before:  MERRITT and MARTIN, Circuit Judges;  FORESTER, Senior District Judge.

Court

• United States Sixth Circuit

Counsel

• For Appellees:
  
• ARGUED:  K. Scott Hamilton, Dickinson Wright, Detroit, Michigan, for Appellants.  Geoffrey L. Silverman, Silverman & Morris, West Bloomfield, Michigan, for Appellee.   ON BRIEF:  K. Scott Hamilton, Dickinson Wright, Detroit, Michigan, for Appellants.  Geoffrey L. Silverman, Karin F. Avery, Silverman & Morris, West Bloomfield, Michigan, for Appellee.