Summary
The United States Bankruptcy Court for the District of Colorado denied Avi Schwalb's emergency and ordinary motions for a stay pending appeal of the order converting his Chapter 11 case to Chapter 7. The court concluded that Schwalb had not shown a likelihood of success on appeal, irreparable harm, absence of harm to creditors, or that the public interest favored a stay. The court emphasized that Chapter 7 administration would centralize asset liquidation, preserve estate property, and protect creditor interests.
Court
United States Bankruptcy Court for the District of Colorado
Jurisdiction
United States Bankruptcy Court for the District of Colorado
Decision date
December 2, 2025
Docket number
25-12666-JGR
Disposition
other
Questions Presented
- Whether Schwalb established a strong likelihood of success on his appeal of the order converting his chapter 11 case to chapter 7.
- Whether Schwalb would suffer immediate or irreparable harm absent a stay pending appeal.
- Whether granting a stay would harm creditors and other opposing parties.
- Whether the public interest supported a stay pending appeal.
Holdings
- The debtor failed to establish any likelihood of success on appeal because the record supported conversion under 11 U.S.C. § 1112(b), the oral ruling incorporated findings of fact and conclusions of law into the minute order, the debtor had not shown eligibility for continuation under § 1112(b)(2), and the chapter 7 trustee was entitled to control and investigate estate property.
- The debtor failed to show immediate or irreparable harm because chapter 7 administration would provide supervision, transparency, preservation of the real estate, orderly sales, and notice-and-hearing procedures for distributions.
- Granting a stay would harm creditors by delaying liquidation and centralized claims administration and by extending bankruptcy benefits to the debtor without the supervision of a chapter 7 trustee.
- The debtor failed to establish that the public interest supported a stay pending appeal.
Court Document
Open PDFLoading document…