Del. Judge Freezes Assets Tied To Hotel Ch. 11 Fraud Claim
By Jeff Montgomery (August 27, 2021, 9:03 PM EDT) -- Two men who were major investors in a multihotel bankruptcy earlier this year were hit with an asset freeze order in Delaware bankruptcy court Friday in connection with questions about an allegedly fraudulent, $2.4 million CARES Act Paycheck Protection Program loan in California.
U.S. Bankruptcy Judge Christopher S. Sontchi's order rested in part on a finding that bankruptcy courts can do what district courts cannot, as well as a better than 50% likelihood that cash allegedly received by Taylor Woods, Howard Wu and EHT Asset Management LLC "will dissipate and plaintiff will not recover" without the freeze and injunction.
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