Bankruptcy Court

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Bankruptcy Court

A court constituted to hear bankruptcy cases exclusively. In the United States, bankruptcy courts are constituted under the federal government and are units of regional district courts.
References in periodicals archive ?
When the asset being purchased does not require significant due diligence and no material time or financial investment is required to determine whether the asset being purchased is appropriate, it may be most flexible for the buyer to simply appear at the bankruptcy court hearing and make the offer.
If, on the other hand, the purchase requires investigation because either an entire business is bought or other assets are being purchased that require due diligence and a financial investment prior to the purchase, the purchaser may want to enter into a binding agreement with the DIP (or the bankruptcy trustee) subject only to bankruptcy court approval.
The contracting purchaser usually requires the seller to screen other buyers to ensure that they are financially capable of performing at the bankruptcy court auction.
Bankruptcy court rules throughout the country provide certain minimum times for when notice must be given regarding an asset sale.
Additionally, the purchaser often will require the DIP seller to bifurcate the sales procedure as follows: First, under the purchase agreement, the seller must approach the bankruptcy court and obtain court order approving the procedure.
If the sale procedures are fair and reasonable, the bankruptcy court should approve them at the sale hearing or at a previously conducted hearing for this purpose.
Although you can reap significant financial rewards from bankruptcy court auctions, they are not for the faint of heart.
In one of those mixed blessings that life seems to be full of, the new, high-tech bankruptcy court will mean that Valley judges, attorneys, witnesses, court employees and other citizens enmeshed in bankruptcy proceedings no longer will be forced to make the often arduous trip to downtown Los Angeles, where Valley bankruptcy cases previously were filed and heard.

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