Business Bankruptcies
Our team of attorneys and legal professionals will assist you through your legal entanglements with care and professionalism.
WhatsNew:
Dealing With This Economy
December 3, 2011
We have been busy at the firm helping our clients deal with this difficult economy. We have had some success recently filing Chapter 11's for a few individuals with multiple properties. A recent court ruling from the Middle District of Florida eliminated a major challenge to this type of bankruptcy. We have seen a drop in the number of Chapter 7 cases compared to last year but have been advised by the foreclosure attorneys that the next waive of foreclosures in coming soon. We expect to see a corresponding increase in Chapter 7 filings. Let us know if we can help you with your financial issues.
CurrentNews:
American Airlines Files Chapter 11
December 2, 2011
The parent company of American Airlines filed for bankruptcy protection in late November, seeking relief from crushing debt caused by high fuel prices and expensive labor contracts that its competitors shed years ago. For most travelers, though, flights will operate normally and the airline will honor tickets and take reservations. American said its frequent-flier program would be unaffected.
Recent Events:
The Local Bankruptcy Scene
November 28, 2011
In the Southern District of Florida, our firm has seen an increase in the unwillingness of Chapter 7 trustees to forgo the collection of potential funds. In Florida, an individual's exemptions in bankruptcy are guided by reference to state-not federal-law. An individual is entitled to certain exemptions of personal and real property. Generally, if an individual was over their exemption limit, i.e. having certain property not entitled to exemption, trustees would generally forfeit their right as administrator of the bankruptcy estate to sell the non-exempt asset if the asset was of little value or considered "unsellable." However, our firm has observed a recent uptick in the willingness of the trustee to sell non-exempt assets worth little, seemingly because trustees do not want to lose out on the potential collection of funds. Often, the sale generates funds in an amount that does little more than pay for trustee and professional fees. If you are considering filing for bankruptcy protection, it is imperative to consult with a bankruptcy attorney who can explain your options and offer pre-bankruptcy planning to avoid these common pitfalls.
Small Business Bankruptcies
Business Reorganizations
Businesses in financial trouble can seek protection from creditors in Chapter 11 while a plan of reorganization is worked out. For small business a Chapter 11 bankruptcy filing allows the business to reorganize its debts and make arrangements to pay all or a portion of the debts while obtaining protection from creditors.
A small business Chapter 11 also may be used to sell the business as a going concern. In many cases a small business can continue in operation and jobs can be saved by selling the business as a going concern to a friendly group of investors. Our office has filed numerous Chapter 11 cases in Broward County and throughout South Florida and can help you with this process.
If your business has suffered a temporary setback a Chapter 11 may give you the time you need to get caught up on bills. It also provides a forum to negotiate with all creditors in a setting favorable to the business. Call us if you would like an assessment of whether a Chapter 11 can help your business. We work hard for our clients to find the right solution for any business situation. For more on Chapter 11 see our Chapter 11 page.
Business Liquidation
Chapter 11 can also be used to liquidate a small business in an orderly fashion. The owners and officers can continue to operate the business while its assets are sold in an orderly fashion.
A Chapter 7 liquidation proceeding is also available to partnerships and corporations. If the business is no longer operating it is often more efficient and less stressful to let a Chapter 7 trustee liquidate the business and deal with its creditors. For more on Chapter 7 see our Chapter 7 page.
Some Chapter 11 Success Stories
We have filed Chapter 11 bankruptcies for many small businesses over the past 29 years of practice in bankruptcy law. Here are a few examples:
Small business Chapter 11 to stop an IRS levy and allow the client to negotiate a payment plan with the IRS. We were able to file and remove all levies within 48 hours and save over 100 jobs.
Small business Chapter 11 for a toy distributor which allowed the client to sell the business as a going concern and shed most of the company debt.
A Chapter 11 for an LLC which owned two apartment complexes to reduce the secured debt to the appraised value of the real property.
Small business Chapter 11 for a mortgage company to stop a foreclosure proceeding by its warehouse line lender.
Call us to see if there might be a strategy to help you or your business.
This article is not intended as a substitute for competent legal or accounting representation, but merely as a guide to help you decide whether you need the services of a licensed attorney or CPA.
David W. Langley is licensed to practice only in the State of Florida and handles bankruptcy cases in South Florida, Miami, Hollywood, Fort Lauderdale, Plantation, Pembroke Pines, Pompano,Coral Springs, Deerfield, Boca Raton, Delray and West Palm Beach.