Constructive Notice of a Bankruptcy Case Can Bind Unknown Creditors to All Orders

In In re Cte 1 LLC, the U.S. Bankruptcy Court for the District of New Jersey (Judge Papalia) held that constructive notice of certain orders entered in the bankruptcy case was sufficient to bind an unknown creditor of the debtor to other orders entered in the case and, further, that notice to a creditors' committee was sufficient to protect an unknown creditor's interests.

The decision is a cautionary tale for potential claimants who do not pursue their claims at the earliest possible date.

In this Reuters article, Restructuring & Bankruptcy partner Bethany Simmons and associate Noah Weingarten provide a summary of the case and the U.S. Bankruptcy Court ruling. They highlight that the ruling serves as a reminder to potential claimants that their rights may be limited if they do not diligently pursue their claims promptly.

To read the full article, please visit Reuters’ website.