Rep. Lofgren Pushes Bipartisan Bill to Stop Companies From Picking Friendly Courts for Bankruptcy
The Bankruptcy Venue Reform Act is currently in the early stages of the legislative process. It was recently sent to the House Committee on the Judiciary for review. No further actions are scheduled at this time, and the bill is considered active.
The bill has support from both parties, which helps its chances. However, similar efforts have stalled in the past because some states and large corporations prefer the current rules.
Small businesses that are owed money by a larger company filing for bankruptcy often cannot afford to travel across the country to participate in court proceedings. By requiring bankruptcy cases to be filed where the company actually operates, this bill would make it far easier for local small business creditors to attend hearings and protect their financial interests.
Referred to the House Committee on the Judiciary.
Introduced in House
The bill was officially filed and given a number. It now enters the legislative queue.
No votes have been recorded for this legislation yet.
Politico reports that the House is considering the Bankruptcy Venue Reform Act, bipartisan legislation reintroduced by Reps. Zoe Lofgren and Ben Cline to end corporate 'forum shopping' by requiring companies to file for bankruptcy where their principal business is actually located.
Bloomberg Law reports on the reintroduction of the Bankruptcy Venue Reform Act, highlighting its goal to curb 'judge shopping' and 'venue shopping' in major corporate bankruptcies, a practice that has drawn criticism for allowing companies to pick favorable courts far from their actual operations.
The Wall Street Journal discusses the Bankruptcy Venue Reform Act, noting that the bill aims to restore fairness to the bankruptcy system by ensuring that cases are adjudicated in the communities most affected by a company's financial distress, though some critics argue it could reduce efficiency.
Document Type
Congressional Bill
Official Title
Bankruptcy Venue Reform Act
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