After depositors rushed to withdraw funds from Silicon Valley Bank (SVB), on Friday, March 10, 2023, the US bank was closed by the California Department of Financial Protection and Innovation (DFPI), and the Federal Deposit Insurance Corporation (FDIC) was named receiver of the closed bank.

From television commercials to naming rights for arenas, the topic of cryptocurrency has been hard to avoid. While cryptocurrency may be virtual, its creation or ’mining’ occurs in the real world. This mining poses a credit risk for utility companies, given the incredible amount of electricity required to operate a “mining” facility. For example, crypto mining company Core Scientific, Inc. and its related companies, recently filed Chapter 11 bankruptcy cases where they reported their average monthly utility bills were more than $24.5 million dollars.

Just weeks after the “implosion” of cryptocurrency exchange FTX, credit services provider BlockFi filed for Chapter 11 protection with the United States Bankruptcy Court for the District of New Jersey, indicating that it is burdened with billions of dollars of estimated liabilities and more than 100,000 creditors.

Since 1988, the ‘rule in West Mercia’ – so named after the West Mercia Safetywear v Dodd Court of Appeal case – has been the leading authority for when directors of financially stressed companies are subject to the so-called ‘creditor duty’, namely the duty to consider the interests of the company’s creditors.

As discussed in an earlier post called “Moving Up: Bankruptcy Code Dollar Amounts Will Increase On April 1, 2022,” various dollar amounts in the Bankruptcy Code and related statutory provisions were increased for cases filed on or after today, April 1, 2022.

An official notice from the Judicial Conference of the United States was just published announcing that certain dollar amounts in the Bankruptcy Code will be increased a larger than usual 10.973% this time for new cases filed on or after April 1, 2022.

Each year amendments are made to the Federal Rules of Bankruptcy Procedure, which govern how bankruptcy cases are managed. The amendments address issues identified by an Advisory Committee made up of federal judges, bankruptcy attorneys, and others. The rule amendments are ultimately adopted by the U.S. Supreme Court and technically subject to Congressional disapproval.

After bringing dozens of criminal charges against Paycheck Protection Program loan recipients in recent months, on January 12, the US Department of Justice announced its first civil settlement resolving allegations of PPP loan fraud.

Each year amendments are made to the rules that govern how bankruptcy cases are managed — the Federal Rules of Bankruptcy Procedure. The amendments address issues identified by an Advisory Committee made up of federal judges, bankruptcy attorneys, and others. The rule amendments are ultimately adopted by the U.S. Supreme Court and technically subject to Congressional disapproval.

In the wake of the COVID-19 pandemic, more and more businesses are finding themselves in distress. According to Forbes, 30 million small businesses across the United States are experiencing financial distress, with half of those blaming the global pandemic for revenue decline. These challenges are especially felt by small businesses who may have limited access to the financial markets and investors as compared to larger companies, both public and private, and especially those whose owners have made personal guarantees on business loans.