Coronavirus Pandemic May Force AMC Theaters to File Bankruptcy

Life is changing rapidly for people and businesses across the country as the spread of coronavirus has forced government officials to issue stay-at-home orders. Gatherings of 10 or more are banned almost everywhere, causing businesses that naturally create gatherings- such as movie theaters- to close.  AMC theaters nationwide, including all of the AMC theaters in Mesa and throughout Arizona are at the mercy COVID-19.  This is possibly making AMC Theaters to file bankruptcy.

AMC Mesa Grand 14, 1645 S Stapley Drive, Mesa, AZ 85204

AMC has 634 locations in the US and Canada and more than 1,000 worldwide. There are currently 12 AMC theaters in Arizona. Like many businesses, AMC was forced to close March 16, 2020. More than 600 of AMC’s corporate employees, including the CEO, have been furloughed. It is estimated that AMC is currently running at a $155 million loss per month. The company likely only has enough liquidity to last until June or July. AMC already had $4.9 billion in debt before Coronavirus pandemic started.

Massive debts that will continue to grow combined with AMC’s decision to stop paying its landlords starting in April mean that the closure of your Local AMC Theater (AMC Mesa Grand) may be permanent. Since many Americans are experiencing reduced income, even when movie theaters can reopen, they won’t have the budget for discretionary entertainment purchases such as movie tickets. Those who do have money to go to the movies when the pandemic has passed will probably spend their money elsewhere since they’ve spent the last few months indoors watching movies.

AMC Theaters is not Alone with Financial Woes 

AMC Theaters is not the only entertainment company facing financial woes due to the coronavirus pandemic. Disneyland and Broadway are shut down, along with Arizona’s busiest movie theater chain, Harkins Theaters.  Actually, every movie theater in Arizona is closed for showing films.  A few of the “Dine In Theaters” in Arizona are still serving food to go, with mixed success.

Additionally, the first name in acrobatic entertainment, Cirque du Soleil, is also on the brink of bankruptcy. Major studios are delaying the release of big-budget films, like Pixar’s Soul and Disney’s Mulan. Sony has delayed the release of all of its summer films until late 2020/early 2021. This means the movie production industry will be slowing down. If you know anyone who works on movies, you know these are the type of people who insist on seeing every movie in theaters and refuse to sneak in snacks.

During the recession of 2008, the U.S. saw a 33% increase in bankruptcy filings. It is reasonable to expect a similar increase in bankruptcy filings due to the spread of coronavirus. Businesses aren’t immune to this, and those that don’t receive forms of government bailout will be particularly susceptible. Only time will tell which businesses will survive the pandemic, but bankruptcy isn’t a death sentence. Kodak, Jack in the Box, and Best Buy are examples of businesses who successfully recovered after a bankruptcy.

If you are like AMC Theaters and are feeling the impact of COVID-19 on your financial life, give our Mesa Bankruptcy Lawyers a call.  We offer Free Consultations, Bankruptcy by Phone (Coronavirus Safe), Zero Down Arizona Bankruptcy, File Now,.. Pay Later Bankruptcy,  and experienced attorneys and staff to help you with your debt relief needs.

This is one of the questions that our Arizona bankruptcy lawyers often are asked.  Many people who need to declare bankruptcy have a favorite credit card that they want to keep even after they have filed for bankruptcy protection.  

Unfortunately, you can not pick and choose which debts you are wanting to include in your bankruptcy.  Thus, in a word “No”  you can not keep one of your cards when filing for bankruptcy in Arizona.  We understand that it makes no sense, if you want to pay back some of your debt, it just isn’t fair to your other creditors.
An example of how this might work is:  You have a balance that you want to Discharge on your Mastercard but want to continue to pay the personal loan that you borrowed from your work’s credit union.  That is not something that you can do.  Picking and choosing debts to include in bankruptcy is not allowed.
Credit Cards with Zero Balance in Bankruptcy

Often, people will tell our experienced bankruptcy attorneys that they chose not to include a creditor on their bankruptcy because the card had a zero balance.  Just because they don’t owe money on a card does not make it a card that they can choose not to include.
In fairness, usually they are wanting to hang on to that credit card because it is $0 balance and they hope it will help them re-establish their credit after filing bankruptcy.  Unfortunately, the lenders (issuers of the credit card) don’t look at this the same way.  Most often, the lenders subscribe to services that follow and update current bankruptcies that are filed.  Thus, the lenders compare bankruptcy filings to their own database.  Any active account that the lender might have (Even with a $0 Balance) that matches up to a bankruptcy case will lose borrowing privileges.  Your credit card will be canceled, even sans a balance.
Can I Exclude a Credit Card when Declaring Bankruptcy?  It’s an Important Card.
So, what if I just exclude a card and don’t tell anyone about it?  Will that allow me to keep a credit card when declaring bankruptcy?  Once again, no matter how important the credit or department store card might be, excluding the account and/or the card is simply not an option.  We feel that you should use one of the federal debt relief programs:  Chapter 7 or Chapter 13 in order to start a new debt freeChapter of your life.   

Coronavirus Affects Bankruptcy Courts Closures for Near Future

Panic over the spread of Coronavirus has increased drastically in the past few weeks. The Coronavirus has caused major events and organizations to suspend activities, cruise ship passengers are being quarantined, even toilet paper is out of stock at stores due to citizens stockpiling specific items.  

Even the bankruptcy industry is seeing the effects of this pandemic. Arizona 341 Meetings of Creditors held at Bankruptcy Courts that have been scheduled until March 31, 2020 have been postponed. Anyone who has recently filed bankruptcy, or is considering filing soon needs to understand how this will affect a bankruptcy case.

If you have already filed for bankruptcy:

If your bankruptcy case has already been filed and you have a Meeting of the Creditors on the schedule on or before March 31, 2020, that 341 Hearing will be temporarily postponed. While waiting to hear about your new court date, please be patient. Your lawyer likely will not have any information about the new court date. However, as soon as the attorney receives notice of the new court date, he/she should inform you about the new scheduled date and time. Understand that once your bankruptcy petition was filed, an automatic stay of protection did go into effect, preventing any creditor from collecting on your debts. The automatic stay holds until your case is discharged, which is typically around 60 days after the Meeting of Creditors. Therefore, if your 341 Hearing is postponed, the stay will remain in place and protect you until your bankruptcy case is discharged. Having your 341 Hearing postponed also means that the amount of time before you can get an FHA loan will also be delayed. 

If you are considering filing bankruptcy:

Our law firm files bankruptcies electronically, so the Bankruptcy Court’s closing will not affect your ability to file. The 341 Hearing, however, may be scheduled out further than the typical 30-45 days. If you are making any travel plans in the next couple of months, keep this in mind. Because the bankruptcy will be filed with the court, you will still have the automatic stay of protection to stop creditors from collecting debt until the entire bankruptcy is discharged. 

If you have any concerns about how the Coronavirus may affect your specific bankruptcy case, please contact our law firm. The present Coronavirus epidemic is becoming a factor in many life situations. Consult with an experienced Arizona bankruptcy lawyer with any questions you may have regarding and existing or potential bankruptcy.

A serious concern of many Americans is their medical financial situation. It is difficult to pay off extensive medical debt and other costs that are incurred while receiving medical care. Mesa Bankruptcy Lawyers can provide you with experienced legal representation, information, and assistance if you need guidance as you work through medical debt. 

Medical debt can be wiped out through bankruptcy, but will your Doctor eliminate you as a patient?

The U.S. spent around $3.5 trillion on health expenses, more than any other country in the world. Some experts predict that the average healthcare cost per person in the U.S. will be about $15,000 by 2023. Many individuals are dealing with overwhelming medical bills. In fact, approximately 25% of bankruptcy cases include significant medical debt. 

Will your medical provider drop you after you file for bankruptcy?

A legitimate and common concern is not knowing if a person will lose their doctor if they file bankruptcy to discharge medical debt owed.

Doctor bills are unsecured debt, and can be eliminated in a Chapter 7 bankruptcy. If you file bankruptcy and owe money to your doctor, this debt would be listed in your bankruptcy petition. This doesn’t necessarily mean that you have to change physicians. 

The short answer is, in an emergency medical situation, regardless of the ability to pay or insurance status, everyone is entitled to initial treatment. A federal law called the Emergency Medical Treatment and Labor Act ensures that anyone who seeks medical attention in an emergency department be stabilized and treated. 

When dealing with a non-emergency health provider (including primary physician) may refuse treatment if their fees have been discharged in a bankruptcy. Most medical providers, however, do understand why clients need bankruptcy protection when faced with overwhelming medical debt. Many physicians continue to keep patients as long as they show willingness to pay for future visits. Also, if a medical bill cannot be paid on time, it is crucial that your hospital or doctor’s office be notified immediately. Also, the facility should be able to give you insight on what would happen to your patient status if you do file bankruptcy. 

Wage Garnishments:  Can you get back the money that was garnished from my check after filing bankruptcy in Arizona?

Declaring bankruptcy stops wage garnishments from creditors where they are in the process.  However, you won’t necessarily get any of the money back that has already been taken from you through the garnishment.  The idea is to stop a garnishment before your creditors take action against you.  That is the best way to assure that you won’t lose any of your hard-earned money in a garnishment.

Sears is likely to file Chapter 11 bankruptcy protection. The company plans to plow through the upcoming holiday season, but is leaning toward bankruptcy. The Chapter 11 filing would allow a plan to restructure, versus liquidating immediately.

Sears Holdings is the parent company of Sears and Kmart. According to a recent public records, it is still operating 506 Sears locations (360 Kmart stores).

It is likely that Sears will announce that it will file for bankruptcy, and if this does happen, the nation’s once largest retailer will need a reorganization plan. Because of competition such as Amazon and Walmart, Sears has been struggling as it tries to keep its retail business appealing to shoppers.

With a deadline to pay severe debt, all signs are pointing to Sears Holdings filing bankruptcy.  Surrounding the financial troubles of the company are reports of preparations for filing. Typically, a company that files for bankruptcy negotiates a loan to remain in business while going through the bankruptcy process. Also reported was Sears’ management wanting to use the protection of Chapter 11, which uses a reorganization and restructuring plan (as opposed to Chapter 7, which liquidates and leads to closures).

In 2005, Sears and Kmart formed Sears Holdings and had 3,500 stores in the United States between them. Currently there are under 900 stores following a series of store closings. Sears has announced 46 store closings.

Some reports are calling a bankruptcy filing imminent. If the retailer can negotiate a deal with lenders, it may allow its 900 stores to stay open through the holidays. Some of the Sears stores, however, would have to close immediately (approximately 150 stores). Challenges still remain for the company, however, even if it remains in business over the holidays.

Unfortunately, retail businesses don’t have a great record for success after bankruptcy. Toys R Us, for example has been forced to liquidate after filing a Chapter 11.  Sears does have some value in the Kenmore brand.