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GNC the Latest Bankruptcy Casualty of Coronavirus

GNC the Latest Bankruptcy Casualty of Coronavirus

4 Arizona Locations to Close After Chapter 11 Bankruptcy Filing

Business bankruptcy blogAs the coronavirus pandemic continues to wreak havoc on the global economy, more and more companies are filing for bankruptcy. This year has already seen retail giants like Neiman Marcus, JC Penney, J Crew, and True Religion file for Chapter 11 Bankruptcy. Huge fitness companies like Gold’s Gym and 24 Hour Fitness have also filed for bankruptcy protection amid the Coronavirus Pandemic. The latest big chain to file for Chapter 11 bankruptcy protection is GNC. The retail chain, which specializes in vitamins and dietary supplements, filed its bankruptcy petition June 23, 2020. 

What is Chapter 11 Bankruptcy? Why did GNC Choose Chapter 11?

Chapter 11 Bankruptcy allows businesses and individuals with sizable assets and numerous liabilities to restructure their debt while being overseen and approved by the court and a panel of creditors. The panel, which is composed of the creditors the company owes the most money to, will have authority in major business decisions like entering contracts, taking out loans, and selling shares. However, in Chapter 11, the company can continue to operate in the hopes of turning the business around. Day-to-day operations remain in control of the company’s usual management. A company may still close down using Chapter 11 if settling the outstanding debts would be too complicated with other chapters.

The other chapter that businesses typically file is Chapter 7. Chapter 7 discharges unsecured debts and releases the owner/s of the company from personal liability, but the business must shut down and surrender all of its assets and inventory. 

How the Pandemic Forced GNC to File Bankruptcy

GNC has posted statements to its website explaining its reasoning to file Chapter 11 bankruptcy. The company admitted that financial strains over the past few years had made the company unprepared to handle the pandemic and all of its negative economic effects. Like other brick-and-mortar chains, the competition posed by online retailers has caused GNC to struggle. GNC had already begun closing locations in shopping malls, widely considered to soon be a thing of the past, in 2018. The company had already amassed a staggering $1 billion in debts prior to its 2020 bankruptcy filing. 

The company had plans to refinance and pay off its massive debts. Then the coronavirus pandemic hit. Starting in March, GNC was forced to close approximately 30% of its stores due to stay-at-home and quarantine orders. GNC reported first quarter losses of $200 million, where the chain had reported losses of $15 million for the same time period in 2019. While the company had its peak stock value of $60 per share in 2013, GNC’s stock value was less than a dollar- $0.81- shortly before the bankruptcy filing. 

GNC’s Chapter 11 Bankruptcy Plan

GNC files bankruptcy blogGNC intends to remain open during and after the Chapter 11 bankruptcy, but to reemerge as a smaller company. The company currently has 5,800 locations and intends to almost 20%, or close to 1,200 of those United States locations. The company has already secured financing to fund its restructuring plan. IVC, GNC’s top vitamin supplier, has provided the company with $130 million in funding for the restructuring plan. The vast majority of GNC’s creditors approve of this plan, with a small minority left to sign on to the funding plan. 

If the funding plan from IVC falls through, the company also has the option to sell. Harbin is a Chinese pharmaceutical company that has 41% of GNC’s voting rights. Harbin, along with the rest of the Chapter 11 panel, have promised at least $760 million if the company is sold through court auction. 

Arizona GNC Locations Impacted by Bankruptcy

Arizona is already struggling with a vast amount of new unemployment claims. More than 280,000 people in Arizona have lost their jobs due to the pandemic. GNC’s bankruptcy, and resulting store closures, will only add to Arizona’s climbing number of unemployment claims.

The following stores are closing as a part of GNC’s Chapter 11 Bankruptcy Plan:

  • Madera Village, 9121 E. Tanque Verde Rd, Suite 115, Tucson, Arizona
  • Grayhawk Plaza, 20701 N. Scottsdale Rd, Suite 105, Scottsdale, Arizona
  • Flagstaff Mall, 4650 E 2 N Hwy 89, Flagstaff, Arizona
  • Arrowhead Town Center, 7700 West Arrowhead Towne, Glendale, Arizona

There are more than 20 other GNC locations in Arizona that will remain open through the bankruptcy

gambling and bankruptcy debt blog

I Have a Gambling Problem. Can Bankruptcy Help?

Almost everyone has a friend or relative in their life who has struggled with a bad habit that grew into an addiction. For many, it is smoking, drinking, and other unhealthy lifestyle choices. For others, gambling may become a problem that gets out of control. When it does, the addict usually racks up more gambling debts than they can manage. If you are struggling with this problem, you may be wondering if bankruptcy can help you.

The different chapters of bankruptcy in Phoenix, Arizona

Gambling and bankruptcy blogMost individual bankruptcies are filed under either Chapter 7 or Chapter 13. Chapter 7 bankruptcy has strict income limits and the filer will have to surrender any assets with more equity than that state’s exemptions. Most unsecured non-priority debts will be discharged in Chapter 7. Credit cards, medical bills, repossession deficiencies, and more will be liquidated without any repayment. However, there is a caveat: debts that were fraudulently incurred can’t be discharged in Chapter 7. 

In Chapter 13, debts are reorganized into a payment plan that the filer will pay over the course of 3-5 years. Certain debts, like the balance of an auto loan or past-due child support and spousal maintenance payments, must be paid in full in the plan. Other debts that are prioritized lower may only be partially paid in the plan, but the obligation for them will be discharged once the payment plan has been completed. 

If you have the option between both Chapter 7 and Chapter 13 bankruptcy, you also need to understand the cost difference between the two chapters. While the filing fee for a Chapter 13 is lower ($310 versus $335), attorney representation is absolutely necessary in a Chapter 13 and costs much more than for a Chapter 7. 

The length of the two chapters varies greatly and each will affect your credit differently. A Chapter 7 bankruptcy is typically completed within 4-6 months from the date the petition was filed. Except in special circumstances, a Chapter 13 bankruptcy either lasts 3 years or 5 years. The payment plan will be 3 years for filers who make less than the state median income level (which would qualify them for Chapter 7), and 5 years for those who make more than that amount. After the bankruptcy is discharged, a Chapter 7 will remain on your credit for 10 years from the filing date. A Chapter 13 bankruptcy will remain on your credit for 7 years from the filing date. 

The source of the gambling debt

gambling and bankruptcy debt blogGambling debts are typically accrued in a few different ways. If you took out personal loans or credit cards to pay for your gambling, these debts may be discharged in bankruptcy. They will be wiped clean in Chapter 7 bankruptcy, and are lower priority debts that may only be partially paid before discharge through Chapter 13 bankruptcy. 

You may encounter difficulties discharging your gambling debt in bankruptcy if you secured your debt to any of your property. If you borrowed against the value of your home, car, or other property, your creditor will have a lien on that asset. You will either need to reaffirm (formally agree to repay with the bankruptcy court’s approval) that debt. Otherwise, you will have to surrender whatever property is being used as collateral to discharge the debt. 

Another common type of gambling debt is a “marker.” Many casinos will require you to sign a marker to get chips before you can gamble. The agreement you sign for the marker may have language indicating that you have the amount you are borrowing from the casino available to repay. If you didn’t actually have those funds available at the time when you borrowed them, the court may view that as deceptive borrowing and those debts won’t be discharged in the bankruptcy.

seeking Treatment as part of the bankruptcy process

Filing bankruptcy only solves a symptom of the problem if you struggle with gambling addiction. You may want to consider seeking counseling and other treatment for your addiction before or during your bankruptcy. Some courts may see this treatment as proof that you did intend to repay a marker debt and therefore discharge it in your bankruptcy. 


If you are struggling with gambling debts, you need to learn if bankruptcy is a good option for you. Our expert Phoenix bankruptcy attorneys can analyze your personal situation to determine which chapters you qualify for, and which chapter will serve you best. Don’t let another day go by with the stress of wondering what to do about your debt- call and schedule your free consultation today.  Contact our Phoenix Bankruptcy Lawyers today for a FREE Consultation.
Phoenix Chapter 7 bankruptcy blog

Phoenix Chapter 7 Bankruptcy Requirements

Chapter 7 Bankruptcy Requirements

Contact our Phoenix Bankruptcy Attorneys – 602-509-0955


Phoenix Chapter 7 bankruptcy blogChapter seven bankruptcy is probably the most frequent kind of bankruptcy filed in the United States. Nevertheless, not everybody is permitted to obtain their debts discharged under Chapter seven of the U.S. Bankruptcy Code, so the following are a few simple demands for a situation. To understand whether you qualify for this particular case type, talk with a Chapter seven bankruptcy lawyer in Phoenix about your specific circumstance.  Once your Phoenix Bankruptcy is filed, an Automatic stay starts which protects you from all collection efforts.  Contact our Phoenix Legal Team today and learn more about Phoenix Chapter 7 Bankruptcy Requirement.

Bankruptcy Means Test

The means test was added as a necessity in 2005, plus it calls for you to demonstrate that the household income of yours is below the median for the household dimensions of yours in the state of yours. The Department of Justice (DOJ) reports the median earnings amounts for every state on an annual schedule. If the income of yours isn’t below the median, the attorney of yours might have the ability to subtract specific expenses to reduce your income. When you don’t pass the means test, you won’t have the ability to file for Chapter seven.

Time Since Previous Bankruptcy Filings

In order to avoid bankruptcy abuse, there’s a limit on if you are able to file for Chapter seven in case you’ve a previous discharge. 8 years should pass since your previous Chapter seven filing, or maybe 6 years from the day you filed a Chapter thirteen case.

Filing your bankruptcy is something that should be done by an experienced Arizona Lawyer.  There’s a certain range of documents required to file.  Our debt relief attorney will file your bankruptcy with the court to begin a Chapter seven bankruptcy case for you and your family. You have to file a petition with all the required info and supporting documentation. The attorney of yours is able to help to make sure you’ve all you need before you begin the case of yours to prevent delays.

Chapter 7 Bankruptcy in Phoenix, Arizona

Phoenix bankruptcy attorney blogTalk with a Chapter seven Bankruptcy Lawyer in Phoenix If you’re thinking about debt relief choices, you need to talk to a Phoenix Bankruptcy Attorney at My Arizona Lawyers, PLLC. Contact our Phoenix BK lawyers now or even ask for an appointment online for immediate now.  Our bankruptcy attorneys offer debt relief options including:  Chapter 7 bankruptcy, Chapter 13 Bankruptcy, Emergency Bankruptcy Filings, Medical Bankruptcies, Arizona Zero Down Bankruptcy, Bankruptcy by Phone, Phoenix Chapter Bankruptcy, $0 Down Bankruptcy, and Lien Stripping in a Chapter 13.  Contact us about more Phoenix Chapter 7 Bankruptcy requirements.