Obviously when a person files personal bankruptcy, that makes a significant impact on that person. In addition, bankruptcy can affect people outside of the jurisdiction of the court.
It seems like a person cannot walk through a mall or strip center these days without seeing signs that blare “STORE CLOSING” or “EVERYTHING MUST GO!” The question for regular people is: “What will happen to my favorite store after it goes bankrupt?”
The answer is not simple but there are some general guidelines to consider. Companies that file bankruptcy can 1) liquidate and go out of business, 2) be bought out by another entity, or 3) reorganize and continue to operate.
Many businesses think that they can get back on their feet if they could just have a chance to push the proverbial “pause” button and so a reorganization in bankruptcy (with the powers granted to bankruptcy debtors by the automatic stay) provides exactly that chance. Receiving this respite period is not always the ultimate cure-all. Even with the automatic stay in place, some companies still cannot negotiate all the factors necessary to reorganize. This can lead to the company having to change strategies mid-stream and look for a buyout or move toward liquidation. Since some of these companies are massive and require reading and analyzing thousands of pages of financial documents to determine the best course of action, below is a simple list of several major retailers who have filed for bankruptcy protection recently. If you want additional information about these companies, their bankruptcy cases, or what it means for you, please contact a qualified bankruptcy attorney.
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