Subchapter V of Chapter 11 of the Bankruptcy Code, which took effect in February 2020, creates a more streamlined and less expensive Chapter 11 reorganization path for small business debtors. Under the law as originally...more
In January, we wrote about the Purdue Pharma mega-bankruptcy. A United States District Court in New York vacated Purdue Pharma's confirmed Chapter 11 plan, holding it was improper for the plan to contain non-consensual...more
In Chapter 11, a business or individual seeks to confirm a plan of reorganization that – upon compliance -- will release it from liability for certain claims and obligations -
But what about parties other than the debtor?...more
For creditors dealing with debtors in the shadow of bankruptcy, a common scenario repeats itself.
The creditor repossesses collateral, attaches an account, or sets off a bank account, and then the debtor files a...more
This is a story about contempt and clarity -
It comes to us from a July 2021 North Carolina district court decision reversing a $115,000 sanctions order by a North Carolina bankruptcy court. The story offers a lesson and...more
Bankruptcy offers a temporary sanctuary for parties seeking relief from a variety of problems – financial crisis, lawsuits, collection actions, repossessions, foreclosure, and pandemics.
Filing bankruptcy before a money...more
Subchapter V of Chapter 11 of the Bankruptcy Code, which took effect in February 2020, creates a more streamlined and less expensive Chapter 11 reorganization path for small business debtors.
It has proven popular during...more
To be eligible for a Paycheck Protection Program ("PPP") loan, the applicant must certify on the borrower application that the applicant and any owner of 20% or more of the applicant are not “presently involved in any...more
We previously informed you that if you are a small business that needed to file bankruptcy to save your company, then you may be able to take advantage of Subchapter V of Chapter 11 of the Bankruptcy Code.
The new...more
The Consolidated Appropriations Act of 2021 ("CAA") took effect on December 27, 2020.
The mammoth spending and COVID-19 pandemic relief bill contains provisions related to commercial real estate leases in bankruptcy. ...more
Filing a bankruptcy petition automatically halts efforts to collect pre-petition debts from the debtor outside of bankruptcy.
This "automatic stay" is a command to halt action, and creditors violate it at their own peril. ...more
As the pandemic shows little signs of abating, and many sectors of the economy continue to struggle, the relationship between commercial landlords and tenants may be strained.
Commercial landlords may no longer be willing...more
When a debtor files bankruptcy under Chapter 11, the bankruptcy court does not automatically appoint a trustee.
Unlike Chapter 7, where the court appoints a trustee to investigate the debtor's assets, liquidate assets, and...more
9/18/2020
/ Bankruptcy Code ,
Bankruptcy Court ,
Chapter 11 ,
Chapter 7 ,
Commercial Bankruptcy ,
Creditors ,
Debtors ,
Debtors-in-Possession ,
Liquidation ,
Perjury ,
Reorganizations ,
Trustees
We have previously informed you that if you are a small business that needed to file bankruptcy to save your company, then you may be able to take advantage of Subchapter V of Chapter 11 of the Bankruptcy Code.
The new...more
It is a cardinal sin to attempt to collect a debt or repossess collateral after a borrower files bankruptcy.
Bankruptcy triggers the automatic stay – a command, not a suggestion, that collection activity ceases. This is a...more
8/18/2020
/ Adjournment ,
Attorney's Fees ,
Automatic Stay ,
Bankruptcy Code ,
Bankruptcy Court ,
Chapter 7 ,
Commercial Bankruptcy ,
Creditors ,
Criminal Prosecution ,
Embezzlement ,
Popular
We previously informed you that if you are a small business that needed to file bankruptcy to save your company, you may be able to take advantage of Subchapter V of Chapter 11 of the Bankruptcy Code.
Subchapter V was part...more
Many businesses in bankruptcy or heading that way – particularly retail establishments – face an uncertain future as states and cities impose closures and phased re-openings.
If you lease your office, storefront, or...more
7/2/2020
/ Bankruptcy Court ,
Chapter 11 ,
Coronavirus/COVID-19 ,
Executive Orders ,
Force Majeure Clause ,
Landlords ,
Leases ,
Re-Opening Guidelines ,
Rent ,
Rental Property ,
Restaurant Industry ,
Tenants
In a Chapter 13 bankruptcy, debtors propose a plan to re-pay all or a portion of their debts.
The amount to be repaid depends on how much the debtors earn, the amount and types of debt owed, and how much property they own....more
Many businesses in bankruptcy or heading that way – particularly retail establishments – face an uncertain future as states and cities move from closures to phased re-openings.
No one knows with certainty when the economy...more
We previously informed you that if you are a small business that needed to file bankruptcy to save your company, then you may be able to take advantage of Subchapter V of Chapter 11 of the Bankruptcy Code....more
We previously notified you that the CARES Act contained a key provision related to existing SBA loans. Section 1112 of the Act appropriated $17 billion to subsidize principal, interest, and fees for six months for some small...more
We previously informed you that if you are a small business that needed to file bankruptcy to save your company, you may be able to take advantage of Subchapter V of Chapter 11 of the Bankruptcy Code. Subchapter V was part of...more
The CARES Act, which became law on March 27, 2020, imposes important restrictions on foreclosure activity by servicers of federally-backed mortgage loans.
It also grants expansive rights to borrowers to seek forbearance of...more
While much of the focus of the CARES Act has been on the Paycheck Protection Program, which allocates $349 billion for new SBA loans to cover qualified expenses, the Act contained a key provision related to existing SBA...more
With COVID-19 and the attempts to contain it causing cataclysmic business interruption, many small businesses may find themselves on the brink of insolvency.
While we hope that lenders, landlords, suppliers, and federal,...more