Bankruptcy Filings in Southern Ohio
Bankruptcy filings are more than just legal proceedings—they offer a window into the financial health of a region. In 2024, the Southern District of Ohio, which consists of Cincinnati, Columbus, and Dayton, saw notable trends in bankruptcy cases, reflecting the economic challenges faced by individuals and businesses alike. The district’s bankruptcy filings shed light on the pressures of inflation, debt burdens, and other financial struggles impacting the region.
Breakdown of Bankruptcy Types in the Southern District of Ohio
Bankruptcy filings in the Southern District of Ohio include various chapters of the U.S. Bankruptcy Code, each tailored to address specific financial situations. Here’s a breakdown of the most common types of cases reported in 2024:
Chapter 7: Personal Liquidation Cases
Chapter 7 remains the most frequently filed type of bankruptcy. It is designed for individuals and businesses who lack the financial means to repay their debts. Through this process, non-exempt assets are liquidated to pay creditors, providing a fresh start for the debtor.
Chapter 11: Business Reorganizations
Chapter 11 is primarily used by businesses seeking to restructure their debts while continuing operations. This chapter allows companies to propose a reorganization plan that adjusts debt obligations, enabling them to stay afloat and potentially return to profitability. It is also occasionally used by high-net-worth individuals with complex financial situations.
Chapter 13: Debt Adjustment Plans
Chapter 13 is geared toward individuals with a steady income who wish to reorganize their debts and create a repayment plan, typically lasting three to five years. This chapter allows debtors to retain their assets while working toward financial recovery.
Statistics for 2024: Cincinnati, Columbus, and Dayton
As per the 2024 case filings report published by the Southern District Courts of Ohio, we can see the following trends: [1]
1. In 2024, the Southern District of Ohio saw a total of 11,043 bankruptcy filings.
2. Chapter 7 filings, which involve liquidation of assets, accounted for the majority of cases in 2024.
3. There were 24 Chapter 11 filings indicating business reorganizations throughout the year.
4. Chapter 13 filings totaled 3,371 in 2024.
5. The number of filings varied with April (1,050) having the highest number and January (762) having the lowest.
6. 163 bankruptcy cases were reopened during 2024.
7. Total bankruptcy filings increased by 17.26% from 9,418 in 2023 to 11,043 in 2024.
Two Ohio Bankruptcies You Should Know About
1. Burger King's Bankruptcy Shake-Up in Cincinnati, Columbus, and Dayton
In early 2023, Burger King locations throughout Cincinnati, Columbus, and Dayton faced an uncertain future when their franchise operator, Toms King Holdings, declared bankruptcy. [2]
As news broke that 82 of the 90 locations would be rescued by four different buyers, including Burger King’s own corporate arm, the mood began to shift. Dayton saw a particular spark of hope, with the franchisor planning to acquire several key locations in the area.
Yet, the bankruptcy saga served as a reminder of the evolving landscape in the fast-food industry. Even household names like Burger King are not immune to economic pressures.
2. Shocking Chapter in Cincinnati's Real Estate Scene
In a stunning twist for Cincinnati’s real estate market, one of the city’s largest developers, Ray Schneider, president of Circle Development, filed for Chapter 11 bankruptcy in March 2023. Known for spearheading high-profile projects that shaped the city’s skyline, Schneider’s legal move sent ripples through the local business community. [3]
With liabilities soaring between $100 million and $500 million and assets reported between $10 million and $50 million, the bankruptcy highlighted the stark challenges Circle Development faced.
Among Schneider’s many creditors, claims totaled more than $177 million, with additional unsecured debts of over $7.2 million. Such staggering figures fueled legal disputes, prompting one creditor to push for a court-appointed trustee to oversee the proceedings.
Despite the daunting financial landscape, the Chapter 11 filing was seen as a strategic attempt to reorganize the company’s assets while remaining operational. For Cincinnati residents and stakeholders, this filing marked a pivotal moment that underscored the precarious balance developers face in a fluctuating market.
Common Factors Driving Bankruptcy Filings in Southern Ohio
Several key factors have contributed to the increase in bankruptcy filings across Cincinnati, Columbus, and Dayton in 2024. These challenges reflect both individual struggles and broader economic trends impacting residents and businesses throughout Ohio.
- Rising Cost of Living: Inflation increased prices for essentials like housing, food, and utilities, leaving many households unable to keep up with expenses.
- Mounting Credit Card Debt: Financial struggles led to higher reliance on credit, making repayment unmanageable for many.
- Medical Debt: Unexpected medical emergencies or prolonged illnesses create overwhelming bills, especially for those without sufficient insurance.
- Small Business Challenges: Economic uncertainty, supply chain disruptions, and increased operating costs forced many businesses to file for Chapter 11 to restructure and survive.
- Job Losses: Layoffs and reduced employment opportunities made it difficult for residents to manage debts and financial obligations.
- Stagnant Wages: Income growth failed to keep pace with rising expenses, worsening financial stress for many Ohioans.
Rising costs, stagnant wages, and unforeseen expenses have driven many to seek relief through bankruptcy.
Contact Richard West Law Office today for expert legal guidance and compassionate support in your bankruptcy journey.
Sources:
[1] OHSB Filing Statistics. (n.d.). https://www.ohsb.uscourts.gov/sites/ohsb/files/case-filing-stats/2024.pdf
[2] Strozewski, Z. (2023, April 5). 90 bankrupt Burger King locations have met their fate—and some are closing for good. Eat This Not That. https://www.eatthis.com/toms-king-sells-bankrupt-burger-king-locations/
[3] ABBY MILLER Cincinnati Business Courier. (2023, April 27). One of Cincinnati’s largest developers files for bankruptcy. WKRC. https://local12.com/news/local/cincinnati-large-developer-file-bankruptcy-ray-schneider-files-money-business-liabilities-circle-development
