OAKLAND -- A judge will allow bankruptcy proceedings to proceed for the Your Black Muslim Bakery, the troubled business linked to the shooting of a newspaper editor.

In papers filed in U.S. Bankruptcy Court in Oakland, Fayedine Coulter had asked a judge to dismiss an order liquidating the bakery's assets, saying a potential buyer had emerged.

But U.S. bankruptcy Judge Edward Jellen said Thursday the bakery's management problems are not improving and Chapter 7 liquidation is the best way for the business to repay the IRS, its mortgage company and other creditors.

In her filing, Coulter said organization leader Yusuf Bey IV had been "making great strides in correcting its deficiencies" until a police raid Friday led to his arrest in connection with an alleged kidnapping. The raids also led to the business being closed for health code violations.

The raid came a day after the fatal shooting of Oakland Post Editor Chauncey Bailey. Bakery handyman Devaughndre Broussard, 19, has been charged with Bailey's murder. Police say Broussard confessed to the killing and said he was angry over Bailey's investigation into the bakery's finances.

Bey IV has not been charged in Bailey's death. He and two other bakery associates have been charged with kidnapping a woman in May.

The bakery filed for Chapter 11 bankruptcy protection in October. Jellen had converted the case to a Chapter 7 liquidation Aug. 3.

In court papers, Coulter had said a potential buyer for the bakery had emerged and the purchase price would be enough to pay off the mortgage company, the IRS and two other creditors. She did not identify the buyer at a Thursday hearing on the request for dismissal.

Coulter's filing also said the bakery has "obtained the assistance" of U.S. Rep. Barbara Lee's office. Nathan Britton, spokesman for the Oakland Democrat, said Thursday the letter in question was not a blanket endorsement of the group, but part of the office's assistance with federal agencies that is routinely offered to constituents.

"Like many people, I historically supported the bakery because it has been an important institution in the community, but it is clear that is no longer the case," Lee said in a statement. "Knowing what we now know we would not have provided such support and we are reviewing our casework intake process in an effort to avoid any such circumstance in the future."

Bey IV said in court documents that Oakland Mayor Ron Dellums had also expressed support for the bakery, which was founded 40 years ago with the goal of helping Oakland's poor.

A call by The Associated Press Thursday seeking comment from Dellums' office was not returned.