Houston-based ATP Oil and Gas Corp.’s unsecured creditors petitioned a bankruptcy court in Houston to either delegate a trustee to manage the Chapter 11 bankruptcy proceedings of the company or to have the case changed to a Chapter 7 liquidation.

The motion, which is set to be heard on Feb. 21, states that ATP “now finds itself in a death spiral from which it cannot escape” and that “…rather than preserving value for the benefit of the creditors, management’s (in)actions have diminished the value from which creditors may ultimately seek recovery on their claims.”

ATP filed for Chapter 11 bankruptcy with the Southern District of Texas in July 2012. The company is also facing a lawsuit filed by the U.S. Department of Justice on February 11 for allegedly violating the Clean Water Act on account of discharging oil and chemical dispersant into the Gulf of Mexico.

Not only can filing for bankruptcy be complicated, especially as a business, but it can also be difficult to choose what type of bankruptcy is best for your business’s situation. Speak with a knowledgeable Chapter 11 bankruptcy lawyer from the Russell Van Beustring P.C., today about your options when facing financial difficulties by calling 713-973-6650.