Connor Cochran Bankruptcy Update

U.S. Bankruptcy Court has granted the trustee’s motion to convert the Avicenna and Conlan Press bankruptcies from Chapter 11 to Chapter 7, a liquidating bankruptcy. The orders were entered April 30.

Peter S. Beagle sued his former manager Connor Cochran in 2015 for $52 million in damages, disgorgement of illegal gains and restitution, and dissolution of two corporations he co-owns with Cochran, Avicenna Development Corporation, and Conlan Press, Inc. Cochran and his companies filed Chapter 11 bankruptcy on January 4, one day before trial was scheduled to begin in Beagle’s lawsuit against them.

Whether liquidating the corporations’ assets will financially benefit anyone is a question. Several of Cochran’s creditors allege he has converted their assets to his personal use.

However, as reported here in March, the court lifted the automatic stay that took effect when Cochran filed bankruptcy, and allowing Beagle to proceed in California state court against Cochran, Avicenna Development Corporation, and Conlan Press, Inc. and obtain a final judgment.

Then, in April, the court also lifted the stay for Sandbox LLC and Justin Bunnell, investors in The Last Unicorn Tour, allowing them to proceed with state litigation against Avicenna Corporation.

And last month Patrick Lake filed with U.S. Bankruptcy court a “Complaint To Determine Dischargeability of Debt and Related Declaratory Relief” which allowed him to publicly rehearse the grounds for his defamation suit against Cochran. Over the course of several years, Cochran issued updates about his efforts to identify the anonymous source of some allegedly libelous blog posts and tweets, a person he ultimately claimed was Bay Area resident Patrick Lake.

Lake’s statement to the court (see the link below) argues:

…The true facts were that Plaintiff had not forged a contract with Plaintiff; that he does not engage in an “ongoing pattern of deception” in his attorney-client relationships or in his other business relationships; he is not a “stalker” nor “crazed” i.e., mentally unstable, mentally incompetent, or insane; and he was not fired from his employment as an art instructor when he left that employment over five years ago.

…As a proximate result of the defamatory statements of Defendant, Plaintiff has been harmed in that he has suffered past and future loss of income, as well as shame, mortification, emotional distress, public opprobrium, and humiliation, as well as attorneys’ fees incurred to attempt to correct the misleading and false statements of Defendant that have been repeated by others relying on Defendant’s widely published false and defamatory statements. Said damages are in an amount subject to proof at trial.

Lake’s attorney seeks a court ruling that Cochran’s debts to his client are nondischargeable in Cochran’s Chapter 11 proceeding.