As 2019 has come to a close, with Q1 2020 on its way, a look back at 2019’s chapter 11 bankruptcy landscape provides an opportunity to look at the intersection of the law and technology, and in particular the use of data. The data compiled by the First Day team at Reorg reveals a busy year for companies seeking federal bankruptcy protection.
Relative to 2018, 2019 saw a 21% increase in filings, with 400 companies with liabilities exceeding $10 million seeking bankruptcy protection under chapter 11 -- a pace of about 1.1 new cases per day, eclipsing the frequency for at least the past four years.
The increase in filings from the prior year is largely due to distress in the healthcare and energy sectors. A picture of the changes in chapter 11 filing frequency by sector from 2018 to 2019 is below: