Baton Rouge software firm Thinkstream, whose creditors filed a lawsuit to force the company into bankruptcy, has been allowed to convert its case into a voluntary reorganization.

U.S. Bankruptcy Court Judge Douglas Dodd issued the order Thursday. Dodd also cancelled a July 22 hearing on the involuntary Chapter 11 reorganization.

The ruling is the latest twist in the saga of Thinkstream, which operates a statewide law enforcement database. In May, TSB Ventures, a Folsom-based investment firm, asked Dodd to force Thinkstream to reorganize. TSB said Thinkstream owed it more than $9 million and wasn’t making payments.

Thinkstream countered, saying the $4 million in bonds at the heart of the dispute didn’t belong to TSB but to 112 local investors. Thinkstream claimed the original bondholders are victims of a complex shuffling of the bonds’ ownership.

On Wednesday, Dodd ruled against Thinkstream, saying TSB’s claim is legitimate.

Meanwhile, Thinkstream’s original bankruptcy attorney, Edward Gonzales III, has stopped representing the tech company. Barry Grodsky is now representing Thinkstream.

Follow Ted Griggs on Twitter, @tedgriggsbr.