What is Chapter 9 bankruptcy?

Chapter 9 bankruptcy is a process used by insolvent municipal entities, such as districts and towns.

What is an involuntary bankruptcy?

Under the Bankruptcy Code, a group of creditors, or only one creditor (depending on the facts), may file an involuntary bankruptcy against a business or individual under Chapter 7 or Chapter 11.  The petitioning creditor(s) must meet certain requirements in order to file an involuntary bankruptcy case.  In such a case, the debtor has an opportunity to contest the bankruptcy.  If the debtor’s challenge to the involuntary bankruptcy fails, then the debtor is required to file bankruptcy schedules and statements with the Court and comply with other requirements of debtors under the Bankruptcy Code.