Find a Potential Business Bankruptcy Alternative in Wisconsin’s Chapter 128

Exploring alternatives to traditional bankruptcy can be crucial for businesses and individuals facing financial distress in Wisconsin. One such option, unique to the Badger State, is Chapter 128 of the Wisconsin Statutes. This lesser-known proceeding can offer a viable alternative to filing for bankruptcy in certain situations, potentially providing a more streamlined and cost-effective path to debt relief.

Chapter 128: An Overview

Chapter 128 is a state law remedy that allows for the voluntary assignment of assets for the benefit of creditors. While it shares some similarities with federal bankruptcy proceedings, it operates under Wisconsin state law rather than under the federal bankruptcy code. This can offer distinct advantages in certain cases, particularly for businesses that can be sold to preserve value for the creditors.

Key Features of Chapter 128:

• Injunction: Similar to a federal bankruptcy court stay, Chapter 128 provides an injunction that halts collection actions against the debtor.
• Court Supervision: The process is overseen by a state court judge, and a court appointed receiver, often leading to faster and less expensive resolution than bankruptcy court because of the reduced oversight required by the bankruptcy code.
• Flexibility: Chapter 128 can be used for businesses offering options for full asset liquidation of an operating company.
• Debt Cancellation: Chapter 128 can provide a state court order for non-payment of remaining debts upon completion of the proceeding.
• Potentially Lower Costs: In some cases, Chapter 128 may involve lower administrative and legal fees compared to bankruptcy.

When to Consider Chapter 128

Chapter 128 may be particularly beneficial in scenarios such as:

• Small to medium-sized businesses that have more value if sold as operating going concerns
• Situations where a faster resolution is desirable, as Chapter 128 proceedings can often move more quickly than bankruptcy cases

The Importance of Expert Legal Guidance

Navigating the complexities of Chapter 128 versus other bankruptcy options requires in-depth knowledge of both state and federal law. At Richman & Richman LLC, our experienced bankruptcy attorneys are well-versed in the nuances of Wisconsin’s Chapter 128 proceedings. We can provide the expert analysis needed to determine if this alternative is right for your specific financial situation. Indeed, Claire Ann Richman is a long-standing member of the Chapter 128 Committee of the State Bar’s Bankruptcy, Insolvency and Creditors’ Rights Section, which regularly reviews the statute in order to propose updates.

Our approach involves a thorough evaluation of your assets, debts, and long-term financial goals. We consider factors such as:

• The nature of your creditors
• The complexity of your financial situation
• Your desired timeline for resolution
• Potential tax implications
• Long-term financial and business objectives

By leveraging our extensive experience in both bankruptcy and Chapter 128 proceedings, we can guide you toward the most advantageous path for your unique circumstances.

Richman & Richman LLC: Your Trusted Bankruptcy and Financial Litigators

Wisconsin’s Chapter 128 represents a potentially valuable alternative to federal bankruptcy for some debtors. However, determining the best course of action requires careful consideration and expert legal advice.

At Richman & Richman LLC, we are committed to exploring all available options to help our clients work through their financial distress effectively. Whether Chapter 128, traditional bankruptcy, or another solution proves most appropriate, our goal is to provide the skilled representation and strategic guidance needed to achieve the best possible outcome for your financial future. Contact us today at 608-630-8990 to discuss your options.