Why Would A Company File For Bankruptcy In Los Angeles?

Relevant Types Of Bankruptcies In Los Angeles, California

Some companies decide to declare bankruptcy as a solution to their financial problems. Therefore, bankruptcy may be a possibility for you if your company is having financial difficulties and finding it difficult to pay its debts.

However, bankruptcy can be a complicated topic. So, it's essential to learn the basics before delving into California bankruptcy and how it might affect your businesses.

Here's how our prescreened California Business Lawyers would advise clients on filing bankruptcy:

los angeles bankruptcy lawyer

Defining Bankruptcy In Los Angeles, California

A federal court procedure called bankruptcy is available to people and organizations who cannot pay their debts. The procedure pays off all debts and eliminates them while safeguarding people or corporations in bankruptcy court.

"Liquidation" or "reorganization" are frequently used to describe bankruptcy. There are several distinct sorts of bankruptcy that a business owner may have to file for. You should file for a particular type depending on your specific circumstances.

If you're unsure what type of bankruptcy you want to file for, you should consult prescreened Business Lawyers in Los Angeles. They can review your case and advise you on the best next step for your business.

california business law attorney

The Different Types Of Bankruptcy

As mentioned, your filing depends on your business's current situation. Here are two types of bankruptcy businesses file for:

Chapter 7

Liquidation is the name for this sort of bankruptcy. A company that doesn't intend to continue open can file for bankruptcy under Chapter 7. This is so because there is no repayment schedule included in this filing. Small enterprises and sole proprietors should go with this option. The trustee will sell any company assets necessary to pay obligations once satisfied. The bankruptcy code does, however, permit debtors to retain some "exempt property." However, it is anticipated that there will be some sort of property loss with this kind of filing.

A company can start the Chapter 7 bankruptcy process by filing with the bankruptcy court with jurisdiction over it. However, various consequences may occur based on the location of the company or the location of its primary place of business.

For instance, a business legally based in California but with corporate headquarters in a different state has two options. The company can use either file with the bankruptcy courts in the said state or the California bankruptcy courts in the local jurisdiction. In either case, a trustee must be chosen since they are a neutral party.

california business law attorney

Chapter 11

Your company can recover from this kind of bankruptcy. Therefore, Chapter 11 is sometimes known as repayment and, on occasion, reorganization. Whatever it is called, a reorganization plan needs to be created. Thus, although some single proprietorships have elected to file Chapter 11, Chapter 11 bankruptcy is best suited for corporations and limited liability companies. However, chapter 11 does attract more attention from the bankruptcy courts since it enables an organization to recover and includes restructuring.

A firm can file for this kind of bankruptcy with the bankruptcy court that has jurisdiction over it, just like a Chapter 7 petition. In this situation, the jurisdiction is physically located. Chapter 11 is unique because either the debtors or the creditors may file it.

Additionally, an involuntary petition is started by the creditors of a firm. Therefore, further paperwork will be needed unless the judge presiding over the case orders otherwise. Schedules of assets and liabilities, schedules of current revenue and expenses, schedules of contracts and leases, and statements of financial affairs are typically included in documents.

Hire A Los Angeles Business Law Attorney Near You

1000Attorneys.com is a California Bar Association Certified Lawyer Referral Service that refers you to a fitting Lawyer best suited to handle your case. You may contact us through our 24/7 live chat (or complete our case details submission form) for a free initial consultation.

los angeles attorney referral service

California State Bar Certified Lawyer Referral And Information Service

1000Attorneys.com is a California State Bar Certified and approved Lawyer Referral and Information Service.

We provide unbiased and impartial lawyer referrals. This service isn't owned nor operated by lawyers receiving. referrals.


Our objective is that you receive the best comprehensive, high-quality legal representation while holding California attorneys to the highest standards of professional conduct.

Why Lawyer Referrals Matter


The California State Bar investigates on average 16,000 complaints of professional misconduct by attorneys annually.

We offer unbiased California attorney referrals and conduct due diligence by researching and recommending the best local attorney for your case. 


We verify attorneys are in good standing and have the required experience in the type of law related to your legal issue. 

Learn more about attorney discipline here:


Our History 


Since 2005, we have assisted people who need legal representation but whose ability to locate reputable California Lawyers is frustrated by unreliable law firm marketing of self-promoting lawyers and biased legal advertising.

How the LRS Works 

Anyone seeking competent and honest legal representation in California, can request a FREE lawyer referral. 

Once you submit your case details online, our legal 24-hour legal department will review your claim and reply via email. Most cases are reviewed and answered within 15 minutes. 


A free 30 minute consultation with the attorney will be offered to each referred client. 

A representative will follow up a few days later via email with the client after receiving a referral for quality management purposes, or to obtain the status of the case. 

About lawyers from our network

California lawyers in our network are insured, in good standing with the California State Bar, and have substantial experience in their practice area.


Attorneys are available in most areas of law throughout Southern California. Every lawyer in or network has been vetted for:

  • Credentials

  • Education

  • Communication skills

  • Performance

  • Client reviews

  • Fair legal fees

  • Continuing education

  • Professional affiliations

Additionally, we conduct criminal  background checks and attorneys are always monitored by our service.  

How to find the best lawyer for your legal case: 

1. The fastest way to have your legal issue reviewed by one of our attorneys is to send your details online.


Your information will go directly to our 24 hour legal department bypassing our call center. You will get a reply via email within 15 minutes. 

2. You may also inquire about your legal issue via chat where you can get more information related to different areas of law that apply to your case.

3. By calling our lawyer referral hotline 661-310-7999. However, our agents are not attorneys and cannot provide legal advice. Due to high call volumes, it's highly recommended that you use option # 1 above.