CAN CREDITORS FILE AN INVOLUNTARY BANKRUTPCY AFTER AN ASSIGNMENT IS MADE?
Creditors do not lose the right to file an involuntary bankruptcy case against the debtor simply because it has made an assignment. However, bankruptcy courts must refuse to take the case if the involuntary is filed more than 120 days after the assignment is made. Prior to the 120 day mark, the bankruptcy court has the discretion to either take the case or abstain from hearing the case.
