Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comKey Contacts
Back
For the past couple of weeks, thousands of West Virginians have been unable to use tap water because Freedom Industries spilled chemicals into the Elk River. Just a week after this incident, the company filed for protection under Chapter 11 of the United States bankruptcy law.
Bankruptcy documents revealed that Freedom Industries owes $3.6 million to its top 20 unsecured creditors, according to the West Virginia Gazette. The company has $2.4 million in unpaid taxes owed to the Internal Revenue Service as well, which has led to the agency placing three liens on Freedom’s property. These unpaid taxes go back as far as 2000.
Freedom’s Chapter 11 filing could be a strategic one as it puts any lawsuits that were filed against the company as a result of the chemical leaks on hold. There are currently around 25 lawsuits already filed against Freedom in Kanawha Circuit Court, along with a federal lawsuit. Chapter 11 also allows the company to continue operating while it seeks to reorganize.
The incident that led to this Chapter 11 filing occurred when methylcycolhexane methanol, which is used to treat coal during the preparation process, leaked into a river, according to CNN Money. This caused the 300,000 West Virginia residents across nine counties to lose their water supplies. Not only did this mean that ordinary citizens couldn’t drink the water, many businesses suffered as well.
In total, Freedom Industries has assets and liabilities listed between $1 million and $10 million in the bankruptcy filing. Shortly after its filing, Freedom requested an emergency motion for a “debt-in-possession,” to help them secure a $5 million loan in order to continue operating.
- Practices: Corporate Transactions & Business, Bankruptcy & Creditors' Rights, Bankruptcy Litigation
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
What Business Owners Get Wrong Before Meeting a Litigation Attorney
What should you expect when meeting a litigation attorney about a business dispute? You should expect to describe the dispute in your own words, hand over the most important documents, flag any deadlines or immediate threats, and leave with a clearer picture of the problem, what information is still needed, and the likely next steps. […]
Author: Michael Mietlicki
Arbitration vs. Litigation vs. Mediation: What New Jersey Businesses Should Know Before Signing a Contract
Arbitration resolves disputes privately before an arbitrator whose decision is usually final, while litigation resolves them in court with full rights of appeal. Whether a business ends up in arbitration or litigation is often decided when it signs the contract, long before any dispute arises. Key Takeaways When facing a contract dispute, carefully consider your […]
Author: Graham Staton
Can You Own Part of a New Jersey Business Without a Written Agreement?
Can you own part of a business in New Jersey without a written agreement? Yes, it is possible. Under New Jersey’s Uniform Partnership Act, a partnership can arise when two or more people carry on a business as co-owners for profit, whether or not they ever intended to form one. Ownership doesn’t necessarily depend on […]
Author: Michael Mietlicki
Crisis-Proofing Your New Jersey Business: Building a Crisis Response Plan Before You Need One
For New Jersey businesses, crisis preparedness should be viewed as a legal and operational function, not simply an emergency-management exercise. A well-designed crisis response plan can help preserve evidence, protect confidential communications, meet reporting obligations, limit unnecessary exposure, and prevent an already difficult situation from becoming a larger legal problem. Key Takeaways A serious crisis […]
Author: Sean M. Pena
Monmouth County's Next Development Wave: What Developers and Investors Need to Know
Monmouth County is entering a significant new phase of development. For those looking to acquire property or undertake a new project, understanding the market opportunity is only the beginning. The more important question is whether a particular property can actually be developed as contemplated and what approvals, agreements, and other conditions will be required to […]
Author: Donald M. Pepe
Are Your Conversations with AI Shielded from Discovery? Courts Are Split
Whether a client’s prompts to a generative AI tool and the documents it produces are protected from disclosure depends on the case type, who claims protection, and whether counsel was involved. In United States v. Heppner, a New York federal judge ruled that a criminal defendant’s communications with an AI platform were protected by neither […]
Author: Chris Seelinger
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.