Charities Seek Bankruptcy Protection

Some charities, however, have resorted to Chapter 7 of the code, under which organizations liquidate. The American Musical Theater of San Jose, Calif., for instance, took that route.

Michael Miller, the theater’s chief executive and executive producer, said it had used the bankruptcy code rather than simply dissolve itself because it had loans it could not repay and needed a way to deal with creditors, including some 16,500 subscription ticket holders.