Enlarge By Jennifer Corbett, The News Journal More than half of all large public company bankruptcies filed this year have been filed in Wilmington, Del. WILMINGTON, DEL. WILMINGTON, DEL. RESIDENTS HAVE WIDE-RANGING VIEWS RESIDENTS HAVE WIDE-RANGING VIEWS There's both boom and concern among businesses and workers on Wilmington's Market Street. A look at what's going on:



DuPont's international headquarters at 1007 N. Market St., the state's largest private industrial employer, reported that its third-quarter earnings declined 30%, in part because of the depressed auto and housing markets.

Employees at Wachovia Bank, located in a 900 block building, wonder what the future holds after the bank merges with Wells Fargo.

Developers of a luxury apartment building in the 900 block of North Market Street have been the most active in Wilmington since 1999. Now, they're coping with a huge inventory of residences for sale and lease citywide.

Business is booming for bankruptcy lawyers who practice in U.S. Bankruptcy Court for the District of Delaware in the 800 block. The court, the preferred home for corporate reorganizations, has handled the most Chapter 11 filings in 2008 since the 2001 recession.

Students at the Delaware College of Art and Design in the 600 block are wondering what job prospects will be like in a recession.

Restaurants in the 800 block report business is off. Some have had to rethink their strategies. HOW'S MAIN STREET DOING? HOW'S MAIN STREET DOING? Perry, Iowa: Shaky economy shakes up retailers Indianapolis: City builds in anticipation of recession's end Wilmington, Del. : Business of bankruptcy bustles on Market Street Phoenix: Pain on Main Street: Timing proves bad for Phoenix Sioux Falls: South Dakota city's downtown area builds on its rich past ABOUT OUR SERIES ABOUT OUR SERIES As a national recession deepens and the federal government bails out Wall Street, Americans are increasingly concerned about the economic health of Main Street. That phrase evokes images of family-owned businesses in small towns. Yet, every city has a Main Street -- a major boulevard of commerce in its downtown business district. To find out how these communities are doing, USA TODAY visited five Main Streets in different-size cities around the country. In their long topcoats and dark suits, the men and women bustling down this city's main street might be mistaken for funeral directors. But they're actually lawyers handling the burial of businesses: bankruptcies. Here in the center of Corporate America, where more than 60% of Fortune 500 companies are incorporated, the billable clock is ticking. "It's the bankruptcy capital of the world," says Lynn LoPucki, a law professor at Harvard and UCLA. Amid one of the worst downturns since the Great Depression, scores of companies have come to the federal bankruptcy court on North Market Street to die or restructure themselves. More than half of all large public company bankruptcies filed this year have been filed here, including those of media giant Tribune, Washington Mutual, Linens 'n Things, Sharper Image and Mervyns, a California-based department store chain. As of Dec. 11, Chapter 11 filings were more than four times greater than in 2007. "Last year at this time, we'd have time to breathe in between cases. Now, it's a constant thing," says Clerk of the Court David Bird. A small part of this activity is spilling over into the small-business community along Market Street, including restaurants, caterers and office supply outlets. But the city's bankruptcy boomlet isn't translating into a boom for them. "If you talk to someone who says business is booming, they're lying, unless they're a bankruptcy lawyer," says Leonard Simon, who owns Wright & Simon, a men's clothing store near the bankruptcy court. "I'm a tiny little business owner, and believe me, it's challenging right now." Boom times for some The biggest beneficiaries of the bankruptcy boom are Wilmington's approximately 300 bankruptcy lawyers and their firms. Some firms are expanding their practices, assigning new associates to bankruptcy or moving lawyers from other areas, such as real estate. "We have people working sometimes round the clock," says Mark Collins, chairman of the bankruptcy group at Richards Layton & Finger, which was named the most active debtors' counsel for the first half of 2008 by Bankruptcy Insider, a trade publication. The firm is lead counsel for Linens 'n Things and co-counsel to Washington Mutual. About 20% of its new associates in 2008 were assigned to bankruptcy. Law professor LoPucki says the industry generates professional fees of $1 billion to $2 billion annually nationwide. Half those fees will be awarded in the bankruptcy court in Wilmington. (Some fees will go to out-of-state firms arguing in the bankruptcy court here.) For Laura Davis Jones, the national drumbeat of bad economic news is frightening — until she shows up for work. Jones is one of the managing partners of Pachulski Stang Ziehl & Jones, a national bankruptcy firm that has an office here. "It's uncharted waters," Jones says. Clients pay for more than just their lawyers' time. During a big hearing, Jones' firm might spend $200 or more to provide lunch for 20 to 25 lawyers. "Plus, we have to have beverages and snacks all day," she says. In the Linens 'n Things bankruptcy, Collins says he was putting in more than 100 hours a month. The firm has eight lawyers working on the case. "You're dismantling the entire company. It's more time-consuming," he says. Jones says it's not unusual for her office to have three to five attorneys working full time for a few months when a company first files for bankruptcy, then again when the case is ending. The results on the bottom line are noticeable: 2008 revenue for the Delaware office of Pachulski Stang is above last year and 2006, Jones says. "The ironic part is, it does take money to file bankruptcy. "The more sophisticated the company, the more money it takes." No boom for others Retailers and small businesses on Market Street say they don't see much trickle-down effect. "Downtown is an office park now," says Jack Buckley, co-owner of Ninth Street Book Shop, just off Market Street. "They drive in, and they drive out." Office workers swell the downtown population by about 40,000 during the workweek, says John Rago, communications director for Mayor James Baker. Even those retailers who directly serve law firms say it's not clear whether the bankruptcy business will be enough to offset the overall downturn in the local economy. Like the rest of the nation, Delaware's economy is officially in a recession, says John Stapleford, senior economist at Moody's Economy.com. The number of jobless is at levels not seen since the recession of the early 1980s, according to U.S. Bureau of Labor Statistics data. While unemployment in Delaware historically has tracked below the nation overall, the jobless rate in the city of Wilmington during October was 6.7%, compared with the nation's rate of 6.5%, according to data from the Delaware Department of Labor. What's more, the financial services sector, which has propped up the state's economy for more than two decades, has been shedding jobs since 2002. Two of the state's top private employers — Bank of America and DuPont — recently announced job cuts. Tim Pawliczek, owner of Cavanaugh's Restaurant in the 700 block of North Market Street, says he'll be happy if the legal business keeps him even or slightly ahead. "It's not, 'Ha, ha, we're doing great.' Because that's definitely not the case," says Gail Ashe, general manager at Movable Feast, a Wilmington-area caterer that provides lunches and dinners to the city's law firms. "The law firms are pretty strong. Let's hope that additional business keeps us stable." Milford is a reporter for The News Journal of Wilmington, Del. Guidelines: You share in the USA TODAY community, so please keep your comments smart and civil. Don't attack other readers personally, and keep your language decent. Use the "Report Abuse" button to make a difference. You share in the USA TODAY community, so please keep your comments smart and civil. Don't attack other readers personally, and keep your language decent. Use the "Report Abuse" button to make a difference. Read more