Former Loot Crate’s creditors ask court to convert Chapter 11 case

By Caroline Salls

Pittsburgh, July 23 – The official committee of unsecured creditors appointed for Old LC, Inc.’s bankruptcy case asked the U.S. Bankruptcy Court for the District of Delaware to convert the case to Chapter 7 from Chapter 11, according to a motion filed Wednesday.

Old LC was formerly Loot Crate, Inc.

“The committee seeks immediate conversion of these cases to Chapter 7 in order to avoid continuing losses to and diminution of estates’ assets, especially given that there is no reasonable likelihood of rehabilitation of the debtors’ business as a result of the completed sale, and because the debtors are unlikely to effectuate the confirmation of a Chapter 11 plan,” the motion said.

The committee said Old LC’s cases have been pending for more than 11 months with little to no progress toward a successful reorganization, and the sale of substantially all of the company’s assets closed nearly nine months ago.

The creditor group said a Chapter 7 trustee is capable of conducting the limited activities remaining in the case “at a significantly lower cost.”

Los Angeles-based Loot Crate sells pop culture subscription boxes. The company filed bankruptcy on Aug. 11, 2019 under Chapter 11 case number 19-11791.

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