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  • Writer's pictureDaniel Rodriguez

Company behind Instant Pot and Pyrex files for bankruptcy

What is Chapter 11 bankruptcy? Bankruptcy allows the debtor to discharge certain debts, gain extra time to pay for any remaining debts and even have the backing of a trustee who can pursue lawsuits or claims on the debtor’s behalf to obtain money to pay for debts. In Instant Brands’ case, the company filed for Chapter 11 bankruptcy. Typically used by businesses, Chapter 11 allows the filer to keep their assets and continue operating while they work out a debt reorganization plan. It also allows the filer to act as their own trustee, retaining ownership and authority over business assets as the company undergoes reorganization. However, Chapter 11 is the most complex form of bankruptcy protection. Even if a debtor’s financial problems are dire, the court can dismiss a filing if it finds even a single mistake. The debtor must also submit a reorganization plan within 120 days after filing their petition. Coming up with this plan can be complicated and would need some legal expertise to prepare. The plan also needs to satisfy the needs of creditors, who will be voting on the plan. Business owners filing for Chapter 11 may want to hire a bankruptcy lawyer who can guide them every step of the way. A lawyer can help business owners understand the more complicated aspects of the process, act as a consultant when creating a reorganization plan and ensure that the right debts are discharged or reduced.

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