American Airlines filed for Chapter 11 reorganization. That allows them to cancel existing contracts and renegotiate for better terms in the hopes that they can turn a profit and get out from under their debt. It can be a very effective business tool. Individuals can also do this, but it is called Chapter 13. Chapter 13 allows people to cancel leases or loans, certain home mortgages, credit card and other debt in the hopes that they can get out from financial disaster.