Does a bankruptcy trustee have standing to sue third parties?
MultiRegion, United States of America
The following excerpt is from Mediators, Inc., In re, 105 F.3d 822 (2nd Cir. 1997):
"[A] bankruptcy trustee has no standing generally to sue third parties on behalf of the estate's creditors, but may only assert claims held by the bankrupt corporation itself." Wagoner, 944 F.2d at 118. Were the law otherwise, the debtor's assets would be depleted to enforce rights possessed by third parties, see Barnes v. Schatzkin, 215 A.D. 10, 212 N.Y.S. 536, 539 (1st Dep't 1925), and defendants would face the danger of duplicative recoveries.
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