Principal Attorney Seni Popat Quoted in Bankruptcy Roundtable
Attorney Seni Popat recently participated in a speaking event intended to explore options for creditors and debtors in the age of COVID-19. The event was held by the South Asian and Indo-Caribbean Bar Association of Queens.
The consortium of lawyers agreed the aftermath of the COVID-19 pandemic could result in a substantial spike in financial crises for both individuals and businesses. However, many of those consequences will not be felt until pandemic-spurred executive orders freezing evictions and lawsuits expire or are rescinded. For now, creditors have limited options.
Attorney Seni Popat remarked, “There’s no question it will rise,” in regard to an anticipated flood of bankruptcy-related litigation once restrictions are lifted and courts reopen. Popat went on to point out that recent legislation meant to help small businesses has barely offered many of them sufficient relief. In other words, many small businesses could require some form of bankruptcy proceeding to remain solvent, and the rush of demand may outstrip the bandwidth of understaffed courts.
As for individuals, Popat noted the “staggering statistic” of 36.5 million Americans filing for unemployment as COVID-19 continues to force business closures. Another participating lawyer noted that the number represents nearly one-fifth of the country’s workforce. The sky-high unemployment rate, along with 687 billion dollars in credit card debt not paid in full by Americans each month, further supports the notion that an explosion in bankruptcy litigation may be brewing.
Attorney Popat suggested that recent changes to rules surrounding Chapter 11 bankruptcy could provide some businesses a previously unavailable tool in combatting a financial crisis. The Coronavirus Aid, Relief and Economic Security Act almost tripled the qualifying ceiling for Chapter 11 relief to $7.5 million. However, Popat cautioned that Chapter 11 is primarily designed for larger businesses, as it can be an expensive, time-consuming legal procedure.
Despite this caveat, Popat acknowledged the value of bankruptcy for both individuals and businesses facing financial challenges. “Exploring bankruptcy is certainly an option for certain people that, if you know it’s not realistic for them to repay their debt,” he said.
The participating attorneys concluded by suggesting that patience, kindness, and understanding should be exercised during this unprecedented time. You can read the full coverage of the event at the Queens Chronicle website.
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The COVID-19 pandemic has upended practically every aspect of our society, which means having a strong legal advocate protecting you and your business’s interests is more essential than ever. We at the Law Office of Seni Popat, P.C. have represented hundreds of clients, and our attorney, Seni Popat, has received the exclusive “Super Lawyers” designation by his colleagues.
Do not wait if you or your business is facing a financial crisis as a result of COVID-19. Our team may be able to help. Call (718) 340-3385 or contact us online for a free consultation today.
