Business owners in Ohio who are experiencing financial difficulties have likely explored their options under the protection of the U.S. Bankruptcy Code. Those who want to continue operating their business while reorganizing their debts can file a Chapter 11 bankruptcy. However, if all business operations must cease, Chapter 7 will discharge most debts and liquidate assets to pay creditors. As soon as a bankruptcy filing is recorded, an automatic stay will put a halt on any legal actions already started against the business owner.
A wine supplying company owner in another state is seeking such protecting for his business that apparently has liabilities of approximately $70 million and assets of only $7 million. There are currently four pending fraud lawsuits against the company, and if the Chapter 7 bankruptcy petition is successful, these claims will be cancelled. However, the bankruptcy trustee is investigating the company to determine what happened to the funds that were paid by customers for wines that were never delivered.