Previous Story
2 retirees join move to dismiss Fund’s bankruptcy case
|
Posted on May 07 2012
Two retirees and members of the NMI Retirement Fund are joining the move to have the Fund’s Chapter 11 bankruptcy petition dismissed.
Joaquin Q. Atalig and Jesus I. Taisague, through counsel Ramon K. Quichocho, submitted yesterday to the U.S. District Court for the NMI Bankruptcy Division a notice of joinder to a motion to dismiss that was filed earlier by two unnamed retirees.
Quichocho said his clients are joining Jane Roe and John Doe—the unnamed retirees represented by attorney Bruce Jorgensen’s group—in seeking the dismissal of the Fund’s Chapter 11 petition because the Fund does not meet the Chapter’s requirements.
Unquestionably, Quichocho said, the Fund is not a “person that may be a debtor under Chapter 7,” and therefore the Fund cannot be a debtor under Chapter 11.
The Fund, he pointed out, is a “governmental unit” that is ineligible to file for Chapter 11 bankruptcy.
Quichocho said the Fund was fully aware that it is a “governmental unit” and not a “person” under the Bankruptcy Code.
Quichocho added that the filing of the bankruptcy was not lawful nor was it properly authorized because the Fund board has no power to declare bankruptcy on behalf of the Fund.
The lawyer said the decision to file for bankruptcy, despite the lack of power to do so, was in violation of the CNMI’s Open Government Act, which are additional grounds that requires dismissal of the case.
The U.S. Trustee had also asked the court over the weekend to dismiss the bankruptcy petition.
Assistant U.S. Trustee Curtis Ching echoed the position of Jorgensen’s unnamed clients that the Fund’s structure and statutory existence makes it clear that it is a “governmental unit” of the CNMI.
Ching argued that under Title 11, a debtor must be a “person” in order to be eligible to file for Chapter 11 bankruptcy and may not, under the statutory definition, be a “governmental unit.”
