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New Jersey Sees Surge in High-Profile Bankruptcy Cases
Prominent companies in financial trouble are increasingly seeking bankruptcy protection in New Jersey, when they would previously have sought jurisdictions like New York, Delaware, Virginia and Texas.
Examples including Bed Bath & Beyond Inc., Rite Aid, WeWork and Z Galleria have sought Chapter 11 protection in Newark and Trenton. In addition, Whittaker, Clark & Daniels, a defunct talc supplier, recently filed for Chapter 11 protection in New Jersey after a $29 million verdict in South Carolina.
Critics have accused large companies of gaming the system by filing for bankruptcy in districts where they are not based in order to snag sympathetic judges. Bipartisan bills were introduced to Congress in 2018 that would ban corporations from “venue shopping,” but the proposed legislation did not gain traction.
Rabinowitz Lubetkin & Tully has been selected as local counsel for the Honorable Shelley C. Chapman (Ret.), future claimants’ representative, represented by Willkie Farr & Gallagher in the Whittaker, Clark & Daniels bankruptcy. RLT is also representing landlords of both Bed Bath & Beyond and Rite Aid.