The COVID-19 Bankruptcy Relief Extension Act of 2021, enacted on March 27, gives small businesses with noncontingent liquidated debts (excluding obligations to insiders and affiliates) that total $7.5 million or less until March 27, 2022, to take advantage of a Subchapter V reorganization. The qualifying debt limit was first increased from $2,725,625 to $7.5 million beginning on March 27, 2020, for one year under an amendment of the Coronavirus Aid, Relief, and Economic Security (CARES) Act to Chapter 11 of the U.S. Bankruptcy Code.

The Consolidated Appropriations Act, 2021 (CAA), enacted in December 2020, expands on the advantageous reorganization terms already available for distressed companies under Subchapter V of Chapter 11 of the Bankruptcy Code. Now, reorganizing companies have more time to decide whether to keep or reject real property leases and can stretch out lease obligations under a reorganization plan. These benefits build on the important advantages already available in Subchapter V:

The recently enacted Coronavirus Aid, Relief, and Economic Security (CARES) Act expands the application of the Small Business Reorganization Act of 2019 (SBRA) to more distressed businesses. The SBRA gives qualifying businesses and their owners more leverage to reorganize in bankruptcy court over the objection of creditors. The SBRA process is also less expensive and more streamlined than a typical Chapter 11 case.

In 8-1 decision resolving circuit court split, U.S. Supreme Court holds that bankrupt company’s rejection of executory contract containing trademark license constitutes breach of contract, not its rescission or termination, and licensee retains its rights under the license.

The U.S. Supreme Court has agreed to hear a case that could settle a decades-old debate surrounding the fate of trademark licenses in bankruptcy. The Supreme Court granted Mission Product Holdings’ petition for a writ of certiorari from the First Circuit’s decision in Mission Product Holdings, Inc. v. Tempnology, LLC.