One of the objectives of the Bankruptcy Code is to ensure that each class of creditors is treated equally. And one of the ways that is accomplished is to allow the debtor’s estate to claw back certain pre-petition payments made to creditors. Accordingly, creditors of a debtor who files for bankruptcy are often unpleasantly surprised to learn that they may be forced to relinquish “preferential” payments they received before the bankruptcy filing.

A party who believes that a bankruptcy court erred in either granting or denying relief from the automatic stay needs to act fast to appeal such a decision. In the recently decided case of Ritzen Group, Inc. v. Jackson Masonry, LLC, the U.S. Supreme Court held that: “[A]djudication of a motion for relief from the automatic stay forms a discrete procedural unit within the embracive bankruptcy case” which “yields a final, appealable order when the bankruptcy court unreservedly grants or denies relief.”

On August 23, 2019, the Small Business Reorganization Act of 2019 (the “Act”) was signed into law. The Act, which goes into effect in February of 2020, creates a new Subchapter V under Chapter 11 of the U.S. Bankruptcy Code.

In the past, few small businesses have been able to reorganize under Chapter 11 of the Bankruptcy Code due to the costs and administrative burdens associated with the process.

In bankruptcy, a debtor must relinquish assets to satisfy debts. But there are exceptions to this general rule. Certain assets may be exempted from a debtor’s bankruptcy under federal and state law. Other assets, which are subject to a contractual loan agreement and the security interest of a lender, may be “reaffirmed” by a debtor pursuant to a reaffirmation agreement.

On May 20, 2019, the Supreme Court settled a circuit split concerning whether a debtor’s rejection of a trademark license under § 365 of the Bankruptcy Code “deprives the licensee of its rights to use the trademark.” In a decision written by Justice Kagan, the Supreme Court held that while a debtor-licensor’s rejection of a trademark license results in a pre-petition breach, it does not constitute a rescission of the contract, and thus the licensee may retain the rights granted to it under the license.

In 2018, approximately 40 companies in the oil and gas industry filed bankruptcy in the United States, including companies engaged in exploration and production, oilfield services, and midstream services.

There is nothing quite like obtaining a new customer or getting a new big sale - the prospect of recurring revenue from a new source, the validation of business strategy, or the culmination of a successful negotiation.

However, there is nothing more disheartening than when a new customer is unable or unwilling to pay forthe product you just shipped or services you just provided. Perhaps there is one thing that is worse, when a long-term customer fails to pay.

The purpose of bankruptcy is twofold: (1) to provide the party filing for bankruptcy—the “debtor”—with a fresh start, and (2) to fairly distribute the debtor’s non-exempt assets to creditors in accordance with the priority scheme set forth in the U.S. Bankruptcy Code. This may sound relatively simple, but accomplishing these dual objectives can be difficult. One of the challenges in all bankruptcy cases is determining the scope and extent of assets that constitute “property of the estate” which are available for distribution to creditors.

The purpose of bankruptcy is to provide for an orderly process by which a debtor’s assets can be fairly divided and distributed among creditors.

It is also meant to ensure that debtors can start fresh. Not all of a debtor’s assets are available to creditors—the Bankruptcy Code allows a debtor to keep certain assets safe in bankruptcy through various asset exemptions available under both state and federal law. One such exemption is Michigan’s bankruptcy-specific homestead exemption.

Two years ago, after a slew of bankruptcies in the energy sector triggered by a dramatic drop in commodity prices during the worst downturn for U.S. energy producers since the 1980’s, the Office of the Comptroller of the Currency (OCC) issued new guidance that proposed changes to underwriting analysis and loan risk rating determinations by national banks and federal savings associations of loans secured by oil and gas reserves (RBLs).

1 Driven by a concern that banks were not appropriately capturing risks associated with increased