Chapter 7 - Solutions for a Financial Crisis » Chapter 7 Bankruptcy

Lenny Dykstra, whose nickname on the baseball filed was “Nails,” is displaying some of the grit and determination in his personal financial affairs that made him a star pro baseball player.

Dykstra filed for Chapter 11 bankruptcy in July of 2009, but now he has told the media that he wants the judge in the case to dismiss the bankruptcy case, according to the Wall Street Journal.

Dykstra claims he does not belong in bankruptcy given the assets that he claims to possess.

The former MLB star’s case was originally a California Chapter 7 bankruptcy, but was later converted to a Chapter 11 bankruptcy.

Questions remain about why Dykstra filed for bankruptcy in the first place, and he failed to answer them in recent interviews.

“Bottom line,” he said, “you don’t belong in bankruptcy when you have $100 million in assets.” The Wall Street Journal was not sure how Dykstra came up with the $100 million dollar figure that he discussed. According to the report, creditors have filed for approximately $27 million in claims. Dykstra referred additional questions about his bankruptcy case to his lawyers, who were not available for comment.

In the motion for dismissal of the case, Dykstra makes the case that he would rather work to pay off creditors himself, rather than give over to control of his assets to a trustee that, Dykstra feels, “is only interested in dumping assets as quickly as possible and has in no way shown any regard for the benefits of the creditors.”

Dykstra also expressed interest in regaining control of his car wash business, with the help of what his motion termed “an interested party.”

He stated in the motion’s conclusion that he wanted to “once again claim his role as a productive member of society” by taking ownership of his debts and assets, and working with creditors to pay off debts himself. The motion states that Dykstra is highly motivated to achieve these goals.

A year ago, Dykstra spoke to prominent sports talk radio host Dan Patrick, and had something of a different story to tell about his journey into chapter bankruptcy. He talked of bogus lawsuits and issues with former employees and business associates that added to his financial problems.

He told Patrick that “people pile on, that’s why I did the 11. It makes people stop. It’s probably one of the best weapons known to man for situations such as this.”

“Chapter 11 is like putting a sniper on top of the roof to gun down all those people that are piling on,” Dykstra told Patrick. “It’s the last man standing that wins.” He also said that he felt that the bankruptcy filing would enable him to pay off his legitimate debts and get rid of the “bull,” according to the Wall Street Journal.

Dykstra had to change his approach when a judge decided that he should not have control of his own finances and converted the case to a Chapter 7 bankruptcy. A trustee was appointed to steer the proceedings, and to generate cash for creditors by selling, for example, Dykstra’s multi-million dollar home that once belonged to hockey legend Wayne Gretzky.

A hearing on Dykstra’s motion is scheduled for April 6.