Business Bankruptcy, COVID-19

Stimulus Relief Fails to Save Hundreds of Businesses

The financial ramifications of the COVID-19 pandemic have been significant for countless businesses throughout the United States.  At the start of the pandemic, federal stimulus funds were issued in various forms to help businesses survive the economic crisis. However, as the virus continues, many of these businesses are being forced to close.  

According to a Wall Street Journal analysis of legal filings and government data, over 300 U.S. companies that received approximately half a billion dollars in stimulus relief have also filed for bankruptcy this year. These 300 companies employ a total of 23,400 workers who are being adversely affected.  

Bankruptcy Law, Timothy Kingcade Posts

Bankruptcy Costs Attacked

A recent article in the Wall Street Journal reports that Federal watchdogs are preparing to exert more control over costs in big bankruptcy cases. The new guidelines are expected to be unveiled July 1st and aim to cap fee and expense applications submitted by attorneys for corporate debtors and sometimes creditors. The concern with these new guidelines is that unjustified costs can give the impression that professionals are ‘feasting off a corporate carcass that rightly belongs to the people and businesses they are serving.’

In large Chapter 11 cases, the corporate debtor typically foots the bill for its own lawyers and advisers and professionals retained by some creditors. Judges ultimately decide whether to approve expense and fee requests. U.S. trustees, who are Justice Department employees, watch over the conduct of parties in large corporate bankruptcy cases, including examining fees and expenses. The proposed guidelines, which are expected to apply to attorneys in bankruptcy cases with $50 million or more in assets or liabilities, have gone through two drafts so far.
Some in the field say time and money spent scrutinizing small costs itself adds up and can distract from the bigger task of repayment and reorganization. The push on costs comes as expenses from flights and hotels to photocopies and minibar candy billed by bankruptcy professionals are under greater scrutiny, according to dozens of lawyers and other advisers.

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If you are in a financial crisis and are considering filing bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at