Questions about debts or bankruptcy? Call Doug Beaton, a local specialist in American bankruptcy law.

We are just a few days in to 2012, and there is already rumors of another possible big bankruptcy filing from a titan of corporate America.

This time it is the Eastman Kodak Company that might consider the protection of bankruptcy court. The firm is practically synonymous with photography world wide, but they have obviously been hit hard by the digital revolution.

Kodak has a possible out, however, in that they still own some valuable patents for digital imaging, which some experts think could fetch anywhere up to $3 billion.

That, plus the fact that Kodak still has some cash in the bank, means that any bank filing still might be a ways off. But still, it is a sobering reminder of the state of our economy when we see names like these even mentioned in a bankruptcy context.

If Kodak does file, the next question would be can bankruptcy help them get a fresh start as well? This is a case well-worth watching — if it even becomes a case at all.

By Doug Beaton

At the end of 2011 an Associated Press poll found 62 percent of Americans are optimistic about what 2012 will bring for the nation and 78 percent are hopeful about their family situation, while nearly 70 percent say that 2011 was a year to forget.

Food and gas prices surged in 2011, but there are some signs that the increases are leveling off as the new year begins. About one-third of Americans think their financial situation will improve in 2012, while 11 percent think it will worsen in the coming months.

On political lines, Democrats were more likely to give good reviews to both the old and new year than Republicans. But no trends were discerned concerning individual candidates in the Presidential election.

If you spent 2011 mired in credit card or medical debt, or trying to bail out a house that isn’t worth it anymore, starting the new year off from scratch by filing a bankruptcy case may be the best way to force a turnaround in 2012. Those who file for Chapter 7 now are likely to have their cases completed by the time spring rolls around, and will probably be rebuilding their credit score by the time the holidays roll around again.

If you’d like a fresh start via bankruptcy, and a chance to put yourself back in the optimistic column for the new year, give me a call at (978) 975 -2608 and we can set up a free meeting at my office in North Andover.

By Doug Beaton

One of the downbeat Massachusetts bankruptcy stories of 2011 had a bitter conclusion on Dec. 29th, when the last of the Filene’s Basement stores closed for good.

The Boston retail legend, which filed for bankruptcy for the third time in October, was shuttered after selling off its remaining inventory, plus the store fixtures themselves.

The last bargain hunters were busy scooping up $2 Calvin Klein jeans, $10 shoes, and winter coats for $20, in an assortment of odd sizes.

This is a sad bankruptcy story, because Filene’s Basement was essentially run into the ground by the Sym’s chain, which purchased it a few years ago. About 1500 workers will lose their jobs. And this looks like the end of the line for the Filene’s name, which had been a part of the retail landscape in the northeast since 1909, when Edward A. Filene opened up the basement area of his father’s store in Boston as a place to discount clearance goods.

By Doug Beaton

One of the biggest Massachusetts bankruptcy stories of 2011 took another twist in late December, when the scheduled auction of the restaurant chain was cancelled — for lack of bidders. The only bid was a $75M bid by the firm’s current owner, the equity firm Sun Capital Partners.

The cancellation of the auction makes it more likely that Sun Capital will become the permanent owner of the chain after bankruptcy as well. There was no additional news on whether any more Massachusetts or New Hampshire Friendly’s stores would be closed due to the developments in bankruptcy court.

By Doug Beaton

Elevated prices for gasoline and home heating oil are draining family budgets throughout the Merrimack Valley.

If you are looking for the likely cause for Massachusetts and New Hampshire consumers to file bankruptcy cases in 2012, you may have to look no further.

Even more than the rise in foreclosures, the drop in home values, or the persistent layoffs hitting our region, massive utility bills may fuel the next wave of consumer bankruptcy cases.

Gas prices averaged more than $3.50 per gallon in 2011, and heating oil prices are also at record highs. Oil traded briefly over $100 per barrel in December, though it has backed off a bit as of this writing. The damage that this does to household budgets is incalculable.

Utility bills, are however, dischargeable in bankruptcy; my prediction is that when more people and families are swamped by high fuel prices they will eventually have to turn to the bankruptcy courts for relief and a fresh start.

By Doug Beaton

A federal agency is moving in bankruptcy court against Sun Partners, the owner of the bankrupt Friendly’s restaurant chain, charging them with fraudulently moving assets so that the ice cream stores could avoid paying retirement benefits.

Friendly’s lawyers claim “There is nothing nefarious about selling a business in a bankruptcy auction without compelling a buyer to assume a pension plan, nor is there any Bankruptcy Code provision mandating the assumption of any pension plan or pension liabilities – and such a requirement would dramatically limit [the] debtor’s efforts to reorganize.”

There is an interesting dynamic in bankruptcy cases concerning pensions and other retirement benefits.

In personal bankruptcy cases, they are virtually sacrosanct — a debtor’s retirement accounts are protected virtually 100% from attachment, whit only a few narrow exceptions.

But in corporate bankruptcies, companies can often use the same set of laws to eliminate their responsibilities to current and former employees.

So, in a sense, it matters who is filing the bankruptcy case: if you are an individual, you are certainly better off having your name in the caption of the case, rather than your employer’s!

Postscript: On Dec. 15, 2011, the parties settled this dispute. Sun Partners is going to be allowed to use $50M of the disputed funds to make a $75M “stalking horse” bid when the Friendly’s chain goes up for auction next week.-DB

(Photo by Jonathan Wiggs).

By Doug Beaton