Franchise Bankruptcy Attorneys in Los Angeles

Serious financial problems rarely occur without warning signs. Problems to watch for include:

• Delinquent payments to vendors, landlords, and the franchisor
• Poor or hostile communication with the franchisor
• Multiple failed attempts at financial restructuring
• Pressure in the form of lawsuits, audits, etc.

When concerns like these start piling up, it’s time to contact an OakTree attorney. Contact us for your FREE case evaluation.

In some cases, closing your business and walking away can be the right move. In others, skillful negotiation and reorganization can allow your franchise to survive. Our franchise bankruptcy attorneys will carefully analyze your situation and help you make an informed decision.

Once a case is filed, a “first day” hearing occurs within just a few days. Subsequent hearings and filings follow over the next several months. It can then take up to 18 months to exit from bankruptcy. Count on our OakTree team to be by your side with expert guidance throughout the process.

Chapter 11 bankruptcy can wipe out many debts and financial obligations. The option is available for businesses just as it is for high-net-worth individuals, although the process isn’t as easy for a franchisee.

A franchisee must obtain permission from the court to “assume” their franchise—or continue to do business. The U.S. Bankruptcy Court sees franchise agreements as executory contracts, in which a failure to perform is considered a breach of contract. They must first prove in court that a bankruptcy filing represents sound judgment.

If franchisees want to continue operating their franchise after bankruptcy, the best interests of debtors, creditors, and the bankruptcy estate must be considered.

Almost any entity or person eligible to file for Chapter 7 bankruptcy can file for Chapter 11 bankruptcy. A partnership, corporation, sole proprietorship, or an individual no longer in business may file. If you exceed the debt limits for Chapter 13 bankruptcy, you may be eligible to file for a Chapter 11 plan.

Stockbrokers and commodity brokers cannot file for Chapter 11 bankruptcy. Individuals or married couples filing jointly require additional documents. Businesses and franchises considering Chapter 11 bankruptcy must also show that the reorganization will return them to profitability.

Almost any entity or person eligible to file for Chapter 7 bankruptcy can file for Chapter 11 bankruptcy. A partnership, corporation, sole proprietorship, or an individual no longer in business may file. If you exceed the debt limits for Chapter 13 bankruptcy, you may be eligible to file for a Chapter 11 plan.

Stockbrokers and commodity brokers cannot file for Chapter 11 bankruptcy. Individuals or married couples filing jointly require additional documents. Businesses and franchises considering Chapter 11 bankruptcy must also show that the reorganization will return them to profitability.

Chapter 11 bankruptcy is a complex and lengthy process that carries a burden of legal and administrative fees. You or your shareholders may risk loss of control over the business, and your creditors may object to or challenge the reorganization plan. These risks make it imperative that you consult with a franchise bankruptcy lawyer, like those at Oaktree Law. Your free case evaluation is an excellent place to start.