As COVID-19 continues to threaten the health and wellbeing of Americans and our economy, another potential impact of the pandemic has begun to emerge: a surge in previously healthy companies filing for bankruptcy.
According to a recent Bloomberg Law article, the handful of large companies, such as Frontier Communications, that have recently filed will not be alone in seeking bankruptcy protection as a result of COVID-19 shutting down the economy. Rather, there will likely be a huge uptick in bankruptcy filings anywhere from two to nine months from now.
Unfortunately, the bankruptcy process was not built for a large number of filings and it will likely flood the system. As a result, bankruptcy practitioners are now searching for new tools to respond to today’s unique challenges and slow the spread of this financial distress – just as public health officials are trying to flatten the curve of the virus. Some of the current ideas include standstill agreements for stressed businesses, better lender incentives and even federal bankruptcy loans.
If you have any legal questions about the likely surge in company bankruptcies or any other impacts of COVID-19, please do not hesitate to contact our experienced team at Busch, Slipakoff, Mills & Slomka. Our two leading bankruptcy attorneys, Clive Morgan and Howard Slomka have the experience and knowledge to successfully represent you throughout the entire process.
About Clive Morgan
Clive Morgan has practiced bankruptcy law for 38 years representing both creditors and debtors in business and consumer bankruptcies. He has practiced bankruptcy law in all three federal districts in Florida as well as in the Middle District of North Carolina. In recent years he has worked on protecting creditor rights in all phases of the bankruptcy process. Finally, Mr. Morgan has extensive bankruptcy litigation experience has represented parties in adversary proceedings in Chapter 7, 11 and 13 cases.
About Howard Slomka
Howard Slomka has represented thousands of parties as both debtors and creditors in the complex world of federal bankruptcy. Mr. Slomka practices before the bankruptcy courts in both Georgia and Florida and has taught on topics related to discharges, adversary practice and U.S. Supreme Court recent precedents. He has handled several successful Chapter 11 reorganizations for entities ranging from large hotels and retailers to small businesses and even individual filings. A long-standing Board Member of the Bankruptcy Section of the Atlanta Bar Association, Howie is ready to represent debtors, creditors and other interested parties throughout the bankruptcy process.