Giordano's Pizza BankruptcyIn the Chapter 11 bankruptcy of the Giordano pizza chain has just gone from standard to bizarre after the debtor was removed from his company by the bankruptcy court after he filed a affidavit attempting to terminate the bankruptcy and declaring that he is a freeman over whom the US courts have no jurisdiction.

On April 22, John and Eva Apostolou (the debtors in possession) filed a document with the bankruptcy court in which they declared they were “American Freemen, free inhabitants of the Illinois state, and we find it impossible to obtain State declared Legal Tender at Law.”

A few days later, Giordano’s bankruptcy attorney, Michael Gesas, told the court that he would withdraw from the case, citing “irreconcilable differences” with Apostolou.

The court filings alarmed other stakeholders in the case, including the U.S. trustee for the Chicago bankruptcy court, a Justice Department official who serves as a watchdog of the bankruptcy system. On May 9, the U.S. trustee asked the court to appoint a private trustee to oversee Giordano’s because he wasn’t sure who was in control of the company. Giordano’s also had failed to provide monthly operating reports as required by the bankruptcy court.

The debtors in the case made the mistake of going against the advice of the bankruptcy attorney and filing documents provided to them by a group of people who consider themselves, “sovereign citizens.”  Because of the failure to follow the advice of their bankruptcy attorney, failure to provide requested documents, the failure to properly keep financial records and their insistence on submitting to the bankruptcy court declarations that are considered by most to be ridiculous, these debtors have lost control of their bankruptcy case. A matter of fact, they are not even allowed into their own restaurants if they want to just eat.

If there are any doubts in the minds of those considering bankruptcy, the U.S. court system will have the jurisdiction to prevent you from handling the finances of your company while in bankruptcy if you do not demonstrate that you are competent enough to run it.

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