A bill introduced by Democratic U.S. senators looks to make it easier for Americans to discharge student loans and medical debt. If passed as currently written, the Medical Bankruptcy Fairness Act of 2021 would drastically change the U.S. bankruptcy system by removing certain procedural hurdles that make the bankruptcy process complex and by creating a clearer path to discharging debts that impact millions of Americans.

Brazos Electric Power Cooperative, Inc. (Brazos) recently filed bankruptcy in federal court in Houston, citing a disputed $1.8 billion bill from the state’s grid operator, Electric Reliability Council of Texas (ERCOT). Brazos is one of dozens of electricity providers in Texas facing enormous charges stemming from severe cold snap last month.

Brazos Electric Power Cooperative Inc. (Brazos) recently filed bankruptcy in federal court in Houston, citing a disputed $1.8 billion bill from the state’s grid operator, Electric Reliability Council of Texas (ERCOT). Brazos is one of dozens of electricity providers in Texas facing enormous charges stemming from severe cold snap last month.

Perhaps not unexpectedly, on February 25, 2021, a New York bankruptcy court dismissed the involuntary bankruptcy petition brought earlier in the month by three student loan borrowers against Navient Solutions (see our prior post on the borrowers’ petition here). Navient is the student loan servicing arm of Navient Corporation, one of the world’s largest student loan-originators.

On February 25, 2021, Senators Durbin and Grassley introduced bipartisan legislation to extend the expiration dates of certain bankruptcy provisions of the CARES Act and the Consolidated Appropriations Act to March 27, 2022.

As financial distress grows due to the pandemic, charitable organizations are faced with two immovable forces–increased demand from hard hit communities and decreased funding due to both the economic hardships facing many donors and the cancellation of most live fundraising events. The increased demand and decreased resources of many nonprofit and charitable organizations have caused such organizations to consider filing for chapter 11 protection.

Does a debtor’s pre-petition change of the beneficiary of a life insurance policy constitute a “transfer” of an interest of the debtor in property? Not according to the U.S. Bankruptcy Court for the Eastern District of North Carolina, which held earlier this week that such transfers do not “diminish” the estate.^[1]

Chapter 7 bankruptcy cases are straight liquidations sought by debtors who wish to have most or all of their debts discharged. In Chapter 7 cases, the Chapter 7 trustee obtains control over the debtor’s assets and evaluates whether any equity exists that would offset the costs of selling those assets. If the bankruptcy estate will likely profit from selling the debtor’s assets, the Chapter 7 trustee will liquidate the assets and distribute the proceeds to creditors. This is called an “asset case.”

On 1 January 2021, the Act on confirmation of private restructuring plans (Wet homologatie onderhands akkoord, the “Dutch Scheme“) came into effect. At time of writing (25 February 2021), the Dutch courts have rendered 10 judgments in connection with the Dutch Scheme. This blog provides you with the highlights of this case law.

1. General observations

According to the U.S. Bureau of Labor Statistics, approximately 20 percent of new businesses fail during the first two years of being open, 45 percent during the first five years and 65 percent during the first 10 years. The unprecedented financial challenges of COVID-19 have increased the number of business failures and economists project that the number of failures will accelerate in the quarters ahead.