Common shares are last in priority No they can not sue to get the cash. Common shares are last in the order of priority in a bankruptcy. When Good Stocks Go Bankrupt: http://www.fool.com/foolu/askfoolu/2001/askfoolu011024.htm In Chapter 7 a trustee is appointed to oversee the liquidation (sale) of all of the company's assets and the distribution of the proceeds to the company's creditors. There are strict rules about how the money is distributed. As a shareholder you are the owner of the company and entitled to any value left over after all other debts have been discharged. That's usually not much. In fact, it's usually not anything. Secured creditors get paid first(banks, mortgages, etc.). Unsecured creditors, including bondholders, are next. Shareholders are last on the list. They stood to make the most if the company were successful, so they lose the most when it is not. Understanding Bankruptcies As An Investor http://seekingalpha.com/article/318759-understanding-bankruptcies-as-an-investor In a Chapter 7 bankruptcy, the company will be liquidated, its assets (which can be entire divisions, still operating – mind this) will be sold, and the proceeds divided between the stakeholders obeying to a scale of seniority, in which shareholders are the lowest rung – the last to get paid. Investor Bulletin: Bankruptcy for a Public Company: https://www.investor.gov/news-alerts/investor-bulletins/investor-bulletin-bankruptcy-public-company Regardless of the type of bankruptcy a company files under, any common stock in a bankrupt company is likely to be worthless. That is because the common stock (that is, “equity”) is the last in line to receive what’s available to be distributed in a bankruptcy proceeding. Creditors, including bondholders, suppliers and employees, all come before holders of the company’s common stock. And, even if a company successfully reorganizes, its plan of reorganization often cancels the existing shares of common stock. The common shares are last in line to get a distribution in a bankruptcy. Here, liabilities exceed assets by over $50 million, so the common shares will get nothing. Louis J. Desy Jr. investorshub.advfn.com/uimage/uploads/2016/7/30/mgjmtFar-East-Summary-ofSchules.jpg