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

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

New York 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
Council member Pierina Ana Sanchez and RSA’s Joseph Strasburg (Getty; Twitter)
Citing Bronx fire, Council pushes building violation crackdown
Citing Bronx fire, Council pushes building violation crackdown
SB Development’s Joseph Stern and Northwind’s Ran Eliasaf with rendering of Nova (LinkedIn, NOVA)
SB Development, Hazelton Capital score $62M loan for LIC condo tower
SB Development, Hazelton Capital score $62M loan for LIC condo tower
Illustration of Mayor Eric Adams (Getty; Illustration by Kevin Rebong for The Real Deal)
Oh, rats! Eric Adams contests summons for infestation
Oh, rats! Eric Adams contests summons for infestation
Brookfield's Bruce Flatt with 1100 Newark Turnpike (Loopnet, Brookfield)
Brookfield buys CSX industrial site in Northern New Jersey for $67M
Brookfield buys CSX industrial site in Northern New Jersey for $67M
SL Green's Marc Holliday and Daniel Boulud with One Madison Avenue (Getty, SL Green)
Daniel Boulud lands at SL Green’s One Madison Avenue
Daniel Boulud lands at SL Green’s One Madison Avenue
(Getty)
Strong November hiring reported in real estate industries
Strong November hiring reported in real estate industries
198 Scholes Street, 65 Kent Avenue, 506 DeKalb Avenue and 11 Gunther Place (Illustration by the Real Deal with Getty, Google Maps)
Avi Philipson deal to acquire All Year portfolio is back on
Avi Philipson deal to acquire All Year portfolio is back on
Rihanna with 8000 Mall Walk (Getty, Visit West Chester NY)
Rihanna’s Savage X Fenty heads to Yonkers
Rihanna’s Savage X Fenty heads to Yonkers
arrow_forward_ios

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

Loading...