Motion to Appoint a Chapter 11 Trustee


Summary

This motion to appoint a Chapter 11 trustee template is for use in a Chapter 11 bankruptcy case. This template includes practical guidance, drafting notes, and optional clauses. If the facts and circumstances strongly indicate that management must be divested of control altogether, Section 1104 of the Bankruptcy Code empowers the court to appoint a trustee upon request of a party in interest or the U.S. trustee after notice and a hearing. The statute provides that a trustee may be appointed (1) for cause, including fraud, dishonesty, incompetence, or gross mismanagement or (2) if such appointment is in the interest of creditors, any equity security holders, and other interests of the estate. Parties should note that the court has considerable discretion to appoint a trustee, and that a determination of cause rests within the court's discretion as well. Once appointed, the trustee operates in a fiduciary role in its management of the estate, owing duties of loyalty and care to the ...