US Bankruptcy: A bank account, PO box, and shell companies鈥揺stablishing venue in chapter 11, featuring Multi-Color 鈥� Issue Spotting
Jennifer Lappe, Esq: Legal Analyst - LevFin Insights
19 March 2026
- How debtors use minimal assets such as bank accounts to justify preferred Chapter 11 venues.
- What recent Multi Color and Sorrento rulings reveal about judicial tolerance for venue flexibility.
- Why establishing venue in Chapter 11 has become a critical tactical consideration in complex restructurings.
- How courts weigh statutory rules against fairness, convenience and creditor objections.
- Which signals creditors should monitor when assessing venue risk and restructuring leverage.
A bankruptcy judge鈥檚 recent ruling allowing聽Multi-Color Corp聽(MCC) to keep its chapter 11 case in New Jersey highlights the ease with which a debtor can choose its preferred venue for a restructuring.
MCC, a manufacturer of labels on glass bottles and plastic and metal auto parts,聽聽in New Jersey on Jan. 29 with a restructuring support agreement backed by holders of 72.3% of its secured debt and equity owner Clayton Dubilier & Rice. The company was immediately hit with a challenge from an ad hoc group of cross-holders, which filed a motion asking the bankruptcy court to dismiss the proceedings or transfer the case to the District of Delaware, arguing that MCC lacks a meaningful connection to New Jersey.
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