Some time ago, the FDA issued a ban on Juul products across the country, including Missouri. Juul, which manufactures electronic cigarette products, decided to challenge the ban in court. In the meantime, financial issues compelled company owners to explore various debt relief options. Reportedly, one of the options is a Chapter 11 bankruptcy, which would enable Juul to restructure its finances while retaining possession of the business and continuing operations.
The company walked away with a victory in court after contesting the FDA’s ban on its products. The FDA asserted that Juul had failed to demonstrate evidence to show that its e-cigarettes are safe. However, Juul objected, complaining that the FDA refused to show documentation to support its ban.
Filing for bankruptcy often helps businesses stay afloat
While not all business owners in Missouri or elsewhere are battling the FDA in court proceedings, many are facing other problems that may be placing their businesses at risk. Filing for bankruptcy is often a viable option. For instance, a bankruptcy petition typically activates an automatic stay of any collection activities pending a further order from the court.
Juul spokespeople have stated that they are considering bankruptcy to stay open for business while they continue to pursue their legal options for permanently overturning the marketing ban against the company’s products. Any Missouri business owner who is currently facing a financial crisis may request a meeting with a bankruptcy law attorney. The attorney can carefully review the details of a particular situation and recommend the best course of action.