Suppliers Get Burned in Expensive Bankruptcy Cases

The Wall Street Journal recently reported that an increasing number businesses that provide goods and services for companies during Chapter 11 bankruptcy cases are not being fully compensated. According to the article, “This year, 17% of chapter 11 cases that have ended and involved over $100 million in debt have been dismissed or converted to a liquidation due to administrative insolvency, according to data from Octus. Dismissals and conversions often occur because a company can’t continue to cover the cost of chapter 11. The percentage has generally risen since 2018 and is up from 9% last year, the data show.”

The article mentions that Ivan raised concerns about Party City's budget after it filed for bankruptcy last year. 

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