Delaware Bankruptcy Judge Holds That Increased Chapter 11 U.S. Trustee Fees Pass Constitutional Muster

“It costs a lot of money to go broke. In the case of a chapter 11 bankruptcy, the cost includes quarterly fees payable to the Office of the United States Trustee (the “UST”), a component of the Department of Justice that oversees bankruptcy cases. The UST’s oversight program is funded by chapter 11 debtors pursuant to 28 U.S.C. § 1930(a)(6), which requires each debtor to pay quarterly fees until its case is closed or dismissed. The fee is calculated as a percentage of the debtor’s “disbursements” in each quarter. The fees collected are placed in a UST fund to pay the costs of the UST’s oversight of chapter 11 cases.”

The above excerpt taken from an article authored by Morris Nichols partner Matthew B. Harvey can be found in the Delaware State Bar Association’s monthly DSBA Bar Journal magazine.

Click here to read the full article.

# # #

Matthew B. Harvey, “Delaware Bankruptcy Judge Holds That Increased Chapter 11 U.S. Trustee Fees Pass Constitutional Muster,” DSBA Bar Journal (April 2020)

This article originally appeared in the April 2020 issue of The Journal of the Delaware State Bar Association, a publication of the Delaware State Bar Association.  Copyright © Delaware State Bar Association 2020.  All rights reserved. Reprinted with permission.