In re Snyder, 51 B.R. 432 (Bankr.D.Utah)
PUBLISHED
Chapter 11 debtor's counsel issued a letter to all creditors, asking for their input regarding five potential "plans" that would result in dismissal of the bankruptcy. The letter attached exhibits, including appraisals of debtor's properties, debtor's estimates of costs, and various payout provisions for secured and unsecured creditors. Trustee filed a contempt motion asserting that the communication was an unauthorized solicitation of plan votes that violated 11 U.S.C. § 1125(b), and that debtor's attorney had inappropriately had direct contact with creditors who were represented by counsel. The court ruled that "solicitation" must be narrowly construed, and that debtor's communication, which was not a specific request for official votes, was not an unauthorized solicitation under § 1125(b). However, the court further ruled that debtor's attorney's direct communication with creditors without obtaining their attorneys' permission was a violation of Utah's Disciplinary Rule 7-104(A)(1), and the attorney was reprimanded, but was not required to bear the costs of the proceedings.