A Day in Bankruptcy

Generally, articles containing bankruptcy statistics discuss annual volumes of activity. In this article, we look at
what occurs in a typical business day in the bankruptcy courts across the United States.<small>^{<a href="#2" name="2a">2</a>}</small> There are 202 staffed
locations in the bankruptcy courts nationwide. Excluding weekends and federal holidays, the bankruptcy courts are
open for business about 250 days per year.

</p><h3>Total Case Filings</h3>

<p>In an average working day, 6,310 new cases are filed. (Ten years ago, the daily volume of filings was under
4,000, and 20 years ago fewer than 1,500 cases were filed per day.) About one-third of these cases are joint filings
by married couples, so at least 8,000 individuals declare bankruptcy in a given day. Of the new cases, about 600 are
filed in California and six are filed in Alaska. About 60 cases per day are filed outside the United States. Most of
these are filed in Puerto Rico, but cases are occasionally filed in the U.S. Virgin Islands, Guam and the Northern
Marianas.

</p><h3>Chapter 7</h3>

<p>In a typical working day, 4,440 chapter 7 cases are filed and assigned to approximately 1,200 panel trustees
(of course, not every trustee receives new cases each working day). About 90 of these are business cases and the rest
are consumer cases. The consumer debtors will list about $200 million in general unsecured debt, of which about
$80 million is credit card debt. The vast majority of these cases (96-97 percent) are closed as no-asset cases
generally about four to five months after filing. However, about 160 asset cases are closed each day by chapter 7
trustees, and these cases result each day in more than $5 million collected and distributed by chapter 7 trustees.

</p><p>Among consumer chapter 7 debtors who file on a typical day, there are about:

</p><ul>
<li>133 who owe at least $75,000 in credit card debt
</li><li>191 others who owe between $50,000 and $75,000 in credit card debt

</li><li>32 with more than $50,000 in medical debt
</li><li>18 who owe at least $500,000 in unsecured debt
</li><li>500 who are either retired or disabled
</li><li>200 who are age 70 or older.
</li></ul>

<h3>Chapter 11</h3>

<p>In a typical working day, about 45 chapter 11 cases are filed. About six of these cases are filed at the
bankruptcy court in New York City and two are filed in Delaware. Seven other high-volume bankruptcy courts
generally receive one to two new cases per day, while the other 81 judicial districts receive less than one new case
per day. About every other day there is a chapter 11 filing by a publicly held company, and about every seven
working days a chapter 11 case involving a company with more than $1 billion in assets is filed. In a typical
working day, 16 chapter 11 cases are confirmed—most of which involve companies that filed one to three years
prior.

</p><h3>Chapter 13</h3>

<p>Each working day, 1,823 chapter 13 cases are filed and assigned to about 200 standing chapter 13 trustees
serving nationwide. About one-third of these debtors will eventually complete their repayment plan; the rest will
have their cases either dismissed or converted to chapter 7. Currently, a little more than 500 chapter 13 debtors
complete their repayment plans each working day. This number has been rising in recent years, commensurate with
past increases in chapter 13 filings. Each day chapter 13 trustees distribute about $18 million to creditors.

</p><h3>Chapter 12</h3>

<p>Over the last three years, chapter 12 relief has been available only about half the time. When it is available,
about three chapter 12 cases are filed per day. Only a few judicial districts receive more than one chapter 12 case in a
typical month.

</p><h3>Other Activity</h3>

<p>In a typical working day, employees of the U.S. Trustee Program file about 14 substantial abuse motions
pursuant to §707(b), four actions against bankruptcy petition preparers and three complaints objecting to discharge
pursuant to §727, and refer at least several cases to U.S. Attorneys for possible criminal charges. Chapter 7 and
chapter 13 trustees discover 32 cases with identity problems at meetings of creditors. Most are innocent mistakes
regarding the social security numbers, but some are deliberate instances of intended fraud, identity theft or other
deception.

</p><p>The bankruptcy noticing center mails about 400,000 notices to creditors and parties in interest each day.

</p><p>Total professional fees and expenses in consumer cases amount to about $8 million per day. About
two-thirds of this amount is payments to debtors' attorneys, while the remainder is for court filing fees and
payments to trustees and other professionals. We hesitate to estimate total daily professional fees and expenses in
business bankruptcies. However, we have seen numerous news accounts of the larger business bankruptcies where
professional fees are from $100,000 to more than $1 million per day.

</p><p>ABI gains six new members and about 30 renewed members each working day, and its web site has more
than 80,000 pages viewed per day. Clearly, a day in the life of the bankruptcy world is a busy place in this country.

</p><hr>
<h3>Footnotes</h3>

<p><small>^{<a name="1">1</a>}</small> All views expressed in this article are those of the authors and do not necessarily represent the views of the Executive Office for U.S. Trustees or the Department of Justice. <a href="#1a">Return to article</a>

</p><p><small>^{<a name="2">2</a>}</small> Statistics used in this article were taken from a variety of sources. A list of these sources is available from the authors upon request. <a href="#2a">Return to article</a>