Consumers are filing fewer bankruptcies in a stronger economy, but chapter 11 filings by corporations are up, possibly a reflection of retail sector weakness, Bloomberg BNA reported. Unfolding U.S. trade uncertainty and its potential impact on bankruptcies might also be something to watch going forward, a law school professor and former bankruptcy judge suggested to Bloomberg Law. Bankruptcy filings overall fell 2.6 percent to 775,578 for the year ending June 30, compared to the same period a year ago, the Administrative Office of the U.S. Courts reported July 24. Non-business filings, which comprise most of the activity and capture consumer bankruptcy, fell 2.5 percent to 753,333, while business filings fell 5 percent to 22,245. Business filings include those for chapter 11, which rose 2 percent to 7,141. “The drop in consumer filings likely follows strong job reports; people don’t file as fast if there is money coming in,” <b<Bruce A. Markell</b>, a professor of bankruptcy law at Northwestern Pritzker School of Law in Chicago, told Bloomberg Law. “The rise in chapter 11 filings, however, may indicate some weakness in various sectors, most prominently retail.” Looking ahead, Prof. Markell suggested that uncertainty stemming from possible trade wars and its effect on future filings will be “something to watch.” The figures present filing numbers for cases filed under chapters 7, 11, 12 and 13. Here’s how the latest filings break down: Chapter 7 filings totaled 479,151, down from 489,011 in 2017; chapter 11 filings totaled 7,141, up from 6,999 in 2017; chapter 12 filings totaled 475, down from 482 in 2017; and chapter 13 filings totaled 288,741, down from 299,398 in 2017.
