Bankruptcy filing leads to Supreme Court case

When a person files for bankruptcy, they are seeking court protection from their creditors. Whether the person filing needs time to regroup and negotiate more favorable payment terms or wants to sell assets and get a clean financial slate, abankruptcy filing can solve a myriad of different financial issues. During bankruptcy proceedings, the person filing is required to provide the court with a complete listing of assets and liabilities so the court can get a complete financial picture. This includes bank accounts, real estate, vehicles and anything in the home with value. Sometimes though, a person will attempt to hide assets from the court so it cannot be included in the asset list that can be sold to pay off creditors. Our New York readers might be interested in a case where a man hid assets and the resulting legal battle made it to the highest court in the land. A California man filed a Chapter 7 bankruptcy. He claimed a $75,000 homestead exemption for his home. It was later revealed that he had not listed all of his assets when he filed for protection. The bankruptcy court agreed that part of the homestead exemption could be used to pay… Continue reading

New York-based pizza firm headed for Chapter 11 bankruptcy

Going shopping at the mall for some people is a trip that might involve a stop at the food court for lunch or a snack. For employees of stores in the mall, a stop at the food court might occur during a lunch break. For some people who enjoy eating Sbarro’s pizza, that pleasure might soon be a distant memory. The pizza chain, which is based in New York, has recently announced that it will close 155 locations in North America. Now, it is preparing to file for bankruptcy protection, citing decreased mall traffic as one of the mitigating factors. This isn’t Sbarro’s first time seeking bankruptcy protection. In April 2011, the company cited slow sales and increasing ingredient costs as the reason it needed protection from creditors. Standard & Poor’s has a negative outlook on the pizza chain. A report says that the capital structure of the company is unsustainable, which could lead to filing for Chapter 11bankruptcy protection or selective defaults. While the company is faring poorly in the U.S., it seems to be doing well overseas. In 2013, it opened 81 new stores and currently has over 800 stores worldwide. Finding out that your business isn’t faring… Continue reading

Chapter 11 bankruptcy ahead for shipping company

When most people think of large companies, they tend to think of companies that are successful. While this is generally true since a company has to make money to grow, there are some instances in which a company that has been successful will end up having to file for bankruptcy protection. For Genco Shipping & Trading, filing bankruptcy will likely come before the end of this month. The large shipping company has a principal payment of around $50 million due before the end of the month. It is expected that the company will file for Chapter 11 bankruptcy prior to that payment due date. The owner of the company has been trying to work out a deal with Centerbridge Partners. In that deal, he would run the business but give up control of it. The company made a debt payment of $3.1 million in an effort to stay in compliance with lenders while a prepackaged deal for bankruptcy is worked out. In 2008, the company’s shares were trading as high as $80. With news of the bankruptcy, that has dropped to $1.24. The company is said to owe bondholders $125 million. It also has a bank debt of around $1.1… Continue reading

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