Modell's Bankruptcy Suspension 'Extraordinary Relief Under Extraordinary Circumstances'
The proceedings provide a glimpse of how COVID-19 has further upended the already reeling brick-and-mortar retail industry.
March 28, 2020 at 02:11 PM
7 minute read
The original version of this story was published on New Jersey Law Journal
A federal judge in Newark has suspended the bankruptcy of sporting goods retailer Modell's until April 30, buying the retailer time to liquidate its stores after this month's COVID-19 restrictions temporarily shuttered its going-out-of business stores as shoppers and foot traffic disappeared.
In a March 27 teleconference hearing, U.S. Bankruptcy Judge Vincent Papalia of the District of New Jersey largely agreed—with some modifications—to a consensual agreement hammered out earlier this week between Modell's, lenders, landlords and other creditors.
The ruling, the first known one of its kind pertaining to bankruptcies, allows Modell's to suspend bankruptcy proceedings until April 30, as well as not having to pay April rent to landlords.
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