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US Judge John Dorsey Rejected a Motion to Appoint a Chapter 11 Trustee to Oversee Cred’s Restructuring

Summary: In an omnibus preliminary hearing on Friday, Judge John Dorsey of the Delaware Bankruptcy Court rejected a motion to appoint a Chapter 11 trustee to oversee Cred’s restructuring. The judge made the ruling with the caveat that if Cred equity holders Dan Schatt and Lu Hua attempt to fire Cred board member Grant Lyon, who’s ...

In an omnibus preliminary hearing on Friday, Judge John Dorsey of the Delaware Bankruptcy Court rejected a motion to appoint a Chapter 11 trustee to oversee Cred’s restructuring. The judge made the ruling with the caveat that if Cred equity holders Dan Schatt and Lu Hua attempt to fire Cred board member Grant Lyon, who’s in charge of Cred’s restructuring, then the court will step in and appoint a trustee to oversee the bankruptcy. Dorsey also appointed an examiner, who will provide an independent investigation into Cred’s business. Cred froze withdrawals and deposits in October and declared bankruptcy in November. “There’s no evidence that anybody has done anything wrong since the bankruptcy was filed,” said Paul Hastings LLP partner James Grogan, the attorney representing Cred in the case. 

By Amy Liu

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