What is a creditors committee and what is its role?
A creditors committee is routinely appointed in chapter 11 cases by the U.S. Trustee and ordinarily consists of unsecured creditors who hold the seven largest unsecured claims against the debtor. The creditors committee consults with the debtor on administration of the case, investigates the debtor’s conduct and operation of the business and participates in developing a reorganization plan. The creditors committee in a chapter 11 case may, with the approval of the Bankruptcy Court, hire attorneys, accountants, and other professionals (such as financial advisors).
