Search
Showing results for “Bankruptcy”
Jump to a topic
BankruptcyEnron. WeWork. Lehman Brothers. Bed Bath & Beyond. These famous corporate failures represent some of the nearly 500,000 bankruptcy filings that happen each year in the United States.
For these big businesses—and for everyday individuals, local governments, and even farms and fisheries—bankruptcy can provide a way to tackle crushing debt. It’s a legal process that allows debtors to negotiate and repay money owed. For some, it’s a way to get out of debt entirely.
Bankruptcy isn’t for $500 sitting on a credit card or for routine bills. It’s a solution for extreme debt that a company or an individual is unable to repay. Specifically, it offers a lifeline when debtors start to face lawsuits, garnished wages, and pending evictions. The three most popular types are Chapter 7 (individuals), Chapter 11 (businesses), and Chapter 13 (high-income individuals), with names referring to specific sections of the US Bankruptcy Code.Explore Bankruptcy
What we've found
23andMe declared bankruptcy in March 2025The consumer genetic testing company, which offered detailed genetic profiles from users' saliva samples, suffered financially after they suffered a major data breach affecting almost 7 million customers in 2023. Its flagship product was a one-time genetic analysis which also made retention of users challenging. NPRRed Lobster lost $11M on endless shrimp promotions—but its real estate holdings were what dragged it to bankruptcyGolden Gate Capital, a PE firm, bought Red Lobster in 2014 for $2.1B. Golden Gate then sold Red Lobster's real estate, more than 500 storefronts, which generated $1.5B in revenue and helped finance the PE firm's acquisition of the company. Analysts say increased debt, high rent costs, and low equity put Red Lobster in an impossible position, leading to its 2024 bankruptcy filing—although the shrimp bill probably didn't help. NBC NewsA private equity firm led the leveraged buyout of Toys 'R' Us before the company's bankruptcyAfter being acquired by two private equity firms and a real estate company for more than $6B in 2005, Toys 'R' Us filed for bankruptcy in 2017. Many point to the $400M a year the company had to pay to service its debt, as well as increased competition from online retailers like Amazon, for draining its profits and ultimately dragging it under. In These TimesNvidia CEO Jensen Huang once saved Nvidia from bankruptcy with a multi-million dollar Hail MaryNvidia is now known as one of the top companies contributing to the AI boom, but back in the 1990s, it almost failed. One last-ditch effort conversation that CEO Jensen Huang had with an investor saved the company. SpotifyHooters filed for bankruptcy in March 2025 after being operated by two very distinct operationsFor years before that filing, the restaurant group had been operated by two different companies: one owned by private equity, and the other that includes the original founders. The Wall Street JournalClaire's has filed for bankruptcy multiple timesBetween competition from online retailers such as Shein and Temu, and too many physical stores for today's retail climate, Claire's has had a difficult time modernizing. CNBCA reclusive billionaire ran Sears before its bankruptcyFormer Sears CEO and hedge fund manager Eddie Lampert was once kidnapped from his home in Greenwich, Connecticut by criminals looking to get rich. Some argue that the incident colored Sears’ history. Business InsiderSears filed for Chapter 11 bankruptcy in 2018Although the retailer may have failed financially speaking, some argue that longevity in itself is a success—the brand operated for over 130 years before that bankruptcy filing, after all. The AtlanticWeWork, once a unicorn, declared bankruptcy in 2023This podcast episode chronicles the complete rise and fall of WeWork—from its founding in 2010 to its eventual 2023 bankruptcy. The JournalFrancis Ford Coppola's first musical led him to bankruptcyThe ambitious (and expensive) 1981 movie musical had a budget of $26M, but earned under $1M at the box office. The flop led to a financially difficult period for the renowned director, who declared bankruptcy three times in the decade following the movie's release. Far Out MagazineTom Petty used bankruptcy to change the music industryIn order to resolve a dispute over how a label was treating him as an artist, he self-produced an album and racked up $500K in debt. The resulting bankruptcy filing allowed him to start a new contract with the label on more favorable terms. Behind The SongThere’s an artificial intelligence model trained on bankruptcy lawAlthough it's designed for lawyers, the tool is able to help everyday browsers synthesize important cases and point users to relevant documents about them. One sample using it asks Chatlaw to explain the significance of a recent case and then to define relevant terminology. ChatLawInvestment banking giant Lehman Brothers filed for bankruptcy in September 2008 when it had $619B in debt, making it the largest bankruptcy ever in the USNearly all of its 26,000 employees immediately lost their jobs. But in London, a few hundred remained tucked away, working for another decade to wind down the bank’s European business. BloombergThe history of bankruptcy in the US dates back to the signing of the ConstitutionIn 1787, this founding document gave Congress the right to establish nationwide bankruptcy laws. Legislators took advantage of that power in 1800 when they passed the Bankruptcy Act of 1800, the first comprehensive bankruptcy law at the federal level.
Federal Judicial CenterCalculate: Do you need to file for bankruptcy? About 77% of American households had some debt at the end of 2023. However, when debt becomes crushing, it's time to consider a management plan or a bankruptcy filing. This calculator helps explore whether debt is manageable based on inputs like medical debt, payday loans, and gross annual income. Nerd WalletTake a bankruptcy self-filing quizIf a debtor is considering filing for Chapter 7 bankruptcy, it may be tempting to take a do-it-yourself approach to avoid attorney or preparer fees. However, experts caution that this could come back to bite filers. A quiz can help would-be filers explore whether their cases are complex enough to necessitate a lawyer. The Bankruptcy SiteFor some debtors without assets that can be sold or returned, filing for bankruptcy can provide a path toward a clean slateHowever, the bankruptcy process does not apply to several types of common debt, including money owed toward child support or alimony payments. Most debtors also do not qualify for relief from student loan payments. NoloCredit scores seriously suffer when individuals file for bankruptcy, and there’s no easy fixThose who file for Chapter 7 must wait 10 years before the bankruptcy is removed from their credit report. For Chapter 13, the wait time is seven years. ExperianBrush up on your bankruptcy vocabThe technical term for what happens when a court removes a debtor’s obligation to repay money owed is “discharge.” An “automatic stay” is what goes into place once a filing occurs to prevent a debtor from facing lawsuits, evictions, and other negative consequences until the process wraps up. FindLawFiling for Chapter 7 bankruptcy can be complexDebtors must know whether their liabilities are secured or unsecured and what type of assets they have. They also need to know what a filing can and can’t help them with. NoloSome people make too much money to file for Chapter 7 bankruptcyChapter 7 is the most popular type of filing for individuals needing relief. However, to be eligible, debtors must pass an income means test. At the most basic level, they must prove that their average monthly income over six months is below their state’s median. But there are exceptions. Debt.orgCongress has the power to enact laws related to bankruptcy, thanks to the US ConstitutionIt has done just that since 1800. This legislation, which outlines the various types of bankruptcy filings, has evolved over time. The most recent iteration is the Bankruptcy Reform Act of 1978, which introduced Chapter 11 filings in an effort to make the process easier for businesses and individuals. Corporate Finance InstituteThe most common types of bankruptcy filings are Chapter 7, Chapter 11, and Chapter 13However, there are actually six types in practice today. These less-common options can be lifelines for foreign businesses operating in the US, local governments, and farms and fisheries. InvestopediaBankruptcy is a legal way to manage overwhelming debt, whether for individuals, corporations, or even local governmentsChapter 7 is for liquidating personal assets to clear debts, Chapter 13 allows a repayment plan for individuals, and Chapter 11 lets businesses reorganize to stay afloat. United States CourtsWhat is Chapter 11 bankruptcy?While there are multiple types of bankruptcies, Chapter 11 is probably the one you've heard about the most. Technically speaking, Chapter 11 bankruptcy involves a reorganization of a business's assets and debts under court supervision. Companies such as Red Lobster, WeWork, and Party City have all filed for Chapter 11 bankruptcy in recent years. Learn more about it here. InvestopediaVisualizing the financial troubles of FTX at the time of its bankruptcyJust before Sam Bankman-Fried declared FTX bankrupt in November of 2022, he sought to raise funds quickly to try to save the cryptocurrency exchange. As part of that attempt, he sent around a glimpse of the exchange's current balance sheet, which showed the company had liabilities of $9 billion with only $900 million in liquid assets. Check out the visualization here. Visual CapitalistHear how the Piggly Wiggly grocery store founder attempted to squeeze short sellers by cornering the grocery store's stockFounded in 1916 in Memphis, TN by Clarence Saunders, Piggly Wiggly was the first modern grocery store with aisles for customers to shop for themselves. In 1922, investors placed short positions, sensing that the stock may be overvalued after several Piggly Wiggly franchises in the Northeast went bankrupt. Saunders attempted to squeeze short sellers by taking out $10M and buying up nearly 99% of all available Piggly Wiggly stock. Ultimately, the fiasco ended with Piggly Wiggly's stock being permanently banned from the New York Stock Exchange and Saunders leaving Piggly Wiggly and filing for bankruptcy. SpotifyPets.com is one of the most emblematic dot-com companiesPets.com—an e-commerce pet store webpage—is a prime example of dot-com companies burning through investments. Despite being a popular and well-known brand, the company struggled to generate enough revenue to become profitable. After raising approximately $82.5M in its February 2000 initial public offering, Pets.com filed for bankruptcy in November of that same year. NPRTwain was a notoriously bad investorAfter becoming a famous writer, Twain invested in railroad stocks, a magnetic telegraph, and a printing press that weighed four tons. Eventually, he founded his own publishing company, which ultimately led to his bankruptcy. “He is, in business,” one lawyer said, “just a big overgrown boy.” TimeThe 2024 Synapse collapse took $90M of people’s life savings with itIn 2024, a banking middleman called Synapse declared bankruptcy. Unfortunately, it also locked roughly 100,000 Americans out of their own money, which prompted a class action lawsuit. The IndependentThe BNPL industry boomed amid a surge in online shopping during pandemic-era lockdownsThe buy now, pay later industry allows consumers to buy something immediately and pay in installments without the need for lengthy application and approval processes or high credit scores—and fintech companies Affirm, Klarna, and Afterpay are leading the charge by targeting young adults. WSJThe first portable laptop had a 5-inch screen and weighed 24.5 poundsIntroduced in 1981 for $1795, the Osborne 1 had no battery but came bundled with almost $1,500 worth of software. Early announcement of a future model stalled sales and bankrupted the company as users waited for the more advanced version, a phenomenon now called the Osborne effect. ZME ScienceSears failed to evolve in a changing economyAt its peak, Sears was the largest retailer in the world, making elite objects accessible to the middle class. But in 2018, the company officially filed for bankruptcy due to massive debt and losses. CBS Sunday MorningSome argue the Sears catalog undermined Jim Crow laws in the rural SouthWhen the Sears catalog was popularized, Black Americans didn’t always have an easy time shopping in US stores due to racism and Jim Crow laws. Some say that the Sears catalog was radical at the time for helping Black Americans avoid retail shopping in the South—often a negative experience. VoxMultiple business choices may have hindered Sears’ financial successThere’s no shortage of potential culprits for Sears’ death, from hedge fund manager Eddie Lampert, to Amazon, to the 2008 stock market crash. InvestopediaExplore a Sears historical timelineSears has existed for over 130 years, and is remembered for much more than its 2018 bankruptcy, from the Sears and Roebuck’s catalog to Discover Card and Allstate Insurance. HISTORYScroll through a Sears historical timeline, starting in the year 1886The Sears story starts with railroad worker Richard Sears purchasing a declined shipment of watches for a discounted price. An interactive historical timeline chronicles the history of Sears from then onwards. CNNThomas Cook invented modern tourismIn the mid-1800s, Cook took wealthy Britons on tours of Europe, Africa, the Middle East, and the US, often packaging together transportation, lodging, and food, effectively creating the modern travel agent. He also pioneered travel writing, with “Travellers Handbooks” offering tourists tips for visiting various countries. History HitWeWork’s competitors in the coworking space include Industrious and The MalinWeWork’s story is colored by the times it just couldn’t make its numbers work. Its competitors in the coworking industry, such as Industrious and Convene, seem to be prioritizing slow and stable financial growth instead. IncSoftBank lost billions of dollars on WeWork. Meanwhile, WeWork’s founder walked away a billionaireIn the years leading up to WeWork’s bankruptcy, the tech holding company SoftBank invested roughly $16B into the company. Yahoo FinanceAnticipating moon tourism by 2000, Pan Am issued "First Moon Flight" club cardsMore than 93,000 cards were issued between 1968 and 1971, creating a waitlist that began when Gerhard Pistor, an Austrian journalist, visited a Viennese travel agency to request a flight to the moon. The cards were issued at no cost and numbered in the order they were issued. Smithsonian National Air and Space MuseumSteve Jobs saved a nearly bankrupt AppleApple nearly went bankrupt in 1997, when the tech company had only three months of operational cash left. Apple’s board ousted cofounder Steve Jobs in 1985, but he was brought back as interim CEO to revive the company when Apple purchased Jobs' company, NeXT. YourStoryWhat are business credit scores?Businesses have credit scores the same way individuals do—with a few key differences. For one thing, business credit scores range from 0 to 100 instead of 300 to 850, and are based on factors such as bankruptcy and bill-paying habits. InvestopediaSophia Amoruso's company Nasty Gal was worth $100M at its peakIn 2006, Sophia Amoruso started an eBay shop that would later transform into the clothing company Nasty Gal. However, Amoruso’s rags-to-riches success with Nasty Gal didn’t last. After multiple rounds of layoffs and employee complaints, the company filed for bankruptcy in 2016. Los Angeles TimesA post-game interview with Sophia Amoruso directly after her 2016 Forbes coverThis article from 2016 is a time capsule of sorts. It includes an interview with the person who coined the term “girlboss,” Nasty Gal founder Sophia Amoruso, that took place just after she appeared on the cover of Forbes magazine. We now know that her company would go on to file for bankruptcy the next year. WWDWhy did WeWork fail and why it's still aroundOnce valued at $47B, WeWork promised to revolutionize office space—but rapid expansion, financial red flags, and a pandemic-driven shift in work culture led to its 2023 bankruptcy. This overview looks at its rise and fall, and what’s next for the coworking giant. 1440Sophia Amoruso coined the term 'girlboss' with her bestselling memoirSophia Amoruso turned a small eBay shop into Nasty Gal, a $250M fashion empire. Her success sparked the #Girlboss movement after her bestselling memoir, but behind the rise was a rapid fall. Leadership struggles and financial missteps led to bankruptcy in 2016. 1440Every year, nearly 500,000 bankruptcies are filed in the USFrom personal hardships to major corporate collapses like Enron and Bed Bath & Beyond, filing for bankruptcy isn't a quick fix or a “get-out-of-jail-free” card—it’s a complex, structured process offering debt relief or repayment options. 1440Chapter 7 and Chapter 11 filings can impact common stockholdersPublicly traded companies don’t file for bankruptcy out of nowhere—there are typically warning signs in a stock’s performance, quarterly earnings calls, and US Securities and Exchange Commission filings. Fidelity InvestmentsTesla open-sourced all its patents to speed up industry adoption of electric vehiclesThe company employed a disruptive strategy to transform the transportation market, but early struggles, including leadership shifts and near bankruptcy in 2008, threatened its efforts to bring electric vehicles to the mainstream. Founders
Try another search?