Equity Can’t Alter the Three Petitioning Creditors Requirement, First Circuit Rules
Even if a debtor has committed fraud, at least three creditors still must join an involuntary petition if the debtor has 12 or more creditors.
Court:
Ninth Circuit Bars Third Parties from Seeking Damages for Dismissal of an ‘Involuntary’
If the involuntary corporate debtor was deadlocked and unable to act, the dissenter would have permitted a 50% shareholder to seek damage for dismissal of the petition.
Court: