Lafayette Bankruptcy Law Blog

Companies that have been operating for decades are not immune to serious financial difficulties. In some cases, Louisiana businesses may have been operating well despite the debt liabilities they held, but a sudden financial blow could cause their circumstances to become unmanageable. As a result, they may file for Chapter 11 bankruptcy for help.

This type of scenario recently befell a company operating out of another state. According to reports, Just One More Restaurant licenses the name of several restaurants in and out of the country. However, a recent dispute regarding Palm Steakhouse resulted in financial woes for the company. A lawsuit was filed in which minority shareholders for the restaurant claimed that they had been cheated out of royalties for 40 years. The judge in the case ruled in favor of those shareholders, and as a result, the company was ordered to pay approximately $120 million to those individuals.

Wanting to get out from under crushing debt is a desire of many people in Louisiana and elsewhere. Of course, finding the right option for reaching that goal can be difficult. After all, it can be hard to determine when a debt relief option is legitimate or is a scam that may only make matters worse. While options like bankruptcy are certainly reliable, some individuals may still want information on other possible paths, like debt settlement.

Some parties may think that debt settlement would be a better option than bankruptcy due to the unnecessarily negative reputation that bankruptcy has. However, debt settlement also has the potential for damaging a person's credit. Individuals will need to direct their debt payments to a settlement account, which means that their payments are no longer going toward their actual bills. This action results in delinquency of payments, which damages credit scores.

When businesses begin to struggle, company owners may consider their options for addressing financial downturns. In some cases, reorganizing and carrying out different business strategies can help businesses see better days again, but in other instances, filing for Chapter 11 bankruptcy may be necessary. For some companies, it may be necessary more than once.

Louisiana readers may be interested in a recent bankruptcy filing made by Payless ShoeSource. According to reports, the shoe chain first filed for Chapter 11 in 2017 and closed hundreds of its stores at that time. That filing allowed the company to eliminate over $435 million in liabilities. However, a second filing became necessary, and the company filed that petition recently. This current filing listed debt liabilities as totaling between $500 million and $1 billion.

Money problems as a whole are not a unique issue. Unfortunately, many Louisiana residents and those elsewhere struggle with financial issues. However, each person's exact struggles are different and so are the ways in which they choose to seek debt relief. In any case, it is important to remember that relief options are available.

It was recently reported that Americans are currently carrying a substantial amount of debt. Since 2013, that debt amount has increased by $1 trillion, and the total amount of consumer debt reaches nearly $4 trillion. The report breaks down that amount as $1.6 trillion in student loans, $1 trillion in consumer credit and $1.2 trillion in auto loans. While many people work to pay off their outstanding debt, money mistakes can easily lead to difficulties.