Bankruptcy Protection Is Option For Businesses, Individuals Hurt By Pandemic,…
Bankruptcy Protection Is Option For Businesses, Individuals Hurt By Pandemic, But Lawyers Say Filings Haven’t Become Flood … Yet
June 16, 2020
Sills Cummis’ Managing Partner Max Crane is featured in this article discussing bankruptcy law and the pandemic’s economic impact on businesses.
The article starts, “Proof positive of the pandemic’s economic impact is the fact that there’s one practice area that’s busier than all the others at Sills Cummis & Gross P.C.: bankruptcies.”
“But, for local attorneys such as Max Crane, a managing partner at the Newark-based Sills Cummis & Gross, conversations about bankruptcy protection … are mostly still just conversations.
“So far, New Jersey hasn’t had a massive spike of businesses filing for bankruptcy that weren’t already considering doing so before the pandemic. Crane said businesses have been eager to hear what their options are, but also want to see if there might be light at the end of the tunnel.
“Until businesses come out of the other end of the pandemic situation, there’s going to be a risk of a wave of bankruptcies, even if it hasn’t hit yet.
“‘At some point, it becomes a question of how long these businesses can continue without revenue coming in,’ he said.”
The article later continues, “What many anticipate is that it’s businesses in particular industries, such as bars and restaurants, that might be on the verge of needing to file bankruptcy en masse.
“Based on early conversations in the bankruptcy practice at Sills Cummis & Gross, Crane suspects that to be the case.
“‘It’s really a tale of two cities, because most of the software companies, the medical device companies and the manufacturers of specialized PPE equipment are doing fine,’ Crane said. ‘Travel, retail, hospitality and leisure — those that thrive on highly concentrated, customer-specific, in-person interaction — this virus put all of them behind the eight ball.’
“Crane said his law group has one of the country’s most active health care bankruptcy practices. The pandemic has not been kind to the bottom line of hospitals. Bankruptcies are often the only option for a troubled hospital that needs restructuring, but it’s still a last resort.
“In other words, Crane said, it’s likely that there’s going to be bankruptcy work in the health care and hospital space in the years to come.”