Desert Capital REIT Investor Recovery Options Following Involuntary Chapter 11 Bankruptcy

On May 5, 2011, an involuntary petition for protection under Chapter 11 of Title 11 of the United States Code, 11 U.S.C. §§ 101 et. seq., was filed against Desert Capital REIT, Inc. with the United States Bankruptcy Court for the District of Nevada, Las Vegas Division. Creditors with claims of over $43 million filed the petition to put Desert Capital into involuntary Chapter 11 bankruptcy. Some of these creditors include Taberna Preferred Funding VI, Taberna Preferred Funding VIII and Sage Trust.

Although Desert Capital REIT initially objected to the involuntary bankruptcy, it is reported that in early June 2011, attorneys for Desert Capital REIT told Judge Linda Riegle that it was withdrawing its objection to the bankrupcy proceeding. In light of this development, investors are encouraged to explore their recovery options outside of the Chapter 11 bankruptcy process.

Investors who have suffered losses investing in non-traded REITs like Desert Capital may be able to recover their losses through the securities arbitration process administered by the Financial Industry Regulatory Authority ("FINRA").

The attorneys at Eccleston Law are currently representing investors who have suffered losses in non-traded REITs such as Desert Capital REIT, Inc. in FINRA arbitration proceedings. If you are investor who has suffered losses investing in Desert Capital REIT, Inc. and would like a free, no obligation consultation about your recovery options, please contact one of our attorneys at 312-332-0000.

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