Retention of Bankruptcy Professionals: Court Concludes that a Debtor’s First Cousin Is Not a ‘Relative’ and Thus Not an ‘Insider’

In a recent case, a Chapter 11 debtor sought to employ an accounting firm under section 327(a), the principal of which was the first cousin of the owner of the debtor corporation. The U.S. Trustee objected to the retention, arguing that the debtor’s cousin was an insider. But the bankruptcy judge disagreed.

       

In a recent case, a Chapter 11 debtor sought to employ an accounting firm under section 327(a), the principal of which was the first cousin of the owner of the debtor corporation. The U.S. Trustee objected to the retention, arguing that the debtor’s cousin was an insider. But the bankruptcy judge disagreed.