It’s lawyers before landlords in the Toys “R” Us bankruptcy case

Courts give priority to bankruptcy professionals when it comes to getting paid

TRD New York TRD WEEKEND EDITION /
May.May 13, 2018 01:00 PM

(Credit: Wikipedia, Max Pixel, Pixabay)

Landlords looking to get compensated in Toys “R” Us’s bankruptcy case, get in line.

The toy retailer is expected to pay $348 million to dozens of bankers, lawyers and consultants who tried to fix the company’s problems. And those bankruptcy professionals get priority and are largely assured of getting paid as other creditors fight to get their share, the New York Times reported.

This is nothing particular to Toys “R” Us, as bankruptcy fees have been an issue for years.

“The fees have been increasing, and there is no effective means to control them,” Lynn LoPucki, a bankruptcy professor at the University of California, Los Angeles, told the Times.

Companies can make the decision as to where they want to file for bankruptcy, and judges are hesitant to push back on fees because lawyers could bring the cases elsewhere. Toys “R” Us is based in Wayne, N.J., but filed its Chapter 11 case in Richmond, Va.

The retailer earlier this year announced it planned to close all of its 735 stores, including ones in College Point, Queens. [NYT]Rich Bockmann


Related Articles

arrow_forward_ios
The Martinique hotel (Wikipedia, Google Maps)

Operator of Martinique Hotel in Manhattan files for bankruptcy

Operator of Martinique Hotel in Manhattan files for bankruptcy
CEO Mark Tritton and 410 East 61st Street (Getty, Google Maps)

Bed Bath & Beyond will permanently close UES store

Bed Bath & Beyond will permanently close UES store
A rendering of 556 West 22nd Street (Photo by BASIS Independent Schools)

Private school to expand in former Chelsea Art Museum building

Private school to expand in former Chelsea Art Museum building
Councilwoman Carlina Rivera (Getty, iStock)

City Council extends restaurant, retailer lease protections

City Council extends restaurant, retailer lease protections
With about $23 billion of hotel-related CMBS loans in forbearance, more lenders are looking to offload those mortgages. (iStock)

Hotel industry is in trouble and more lenders want out

Hotel industry is in trouble and more lenders want out
Industry City CEO Andrew Kimball with Amazon CEO Jeff Bezos (Photos via Getty; iStock; Industry City)

Real estate hits bottom as Industry City abandons plan

Real estate hits bottom as Industry City abandons plan
Burlington CEO Michael Sullivan and 2163 Tilden Avenue (Burlington via Facebook; Google Maps)

Burlington Coat Factory inks big lease in Brooklyn

Burlington Coat Factory inks big lease in Brooklyn
Carmel Partners CEO Ron Zeff (JLL)

Carmel Partners sells Norwalk apartment complex valued at $157M

Carmel Partners sells Norwalk apartment complex valued at $157M
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...