Congress passed new, temporary bankruptcy relief measures late last year that impact certain commercial landlords and tenants. Among other things, the new legislation, which was signed into law on Dec. 27, 2020: 1) extends commercial rent forbearance for certain small business tenants experiencing material financial hardship related to the COVID-19 pandemic, 2) lengthens the time period for commercial tenants to assume or reject a commercial lease, and 3) establishes protections for certain commercial deferred rental payment agreements.
Numerous changes have been made to the Paycheck Protection Program (PPP) in recent months, primarily stemming from the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act (Economic Aid Act) signed into law in December 2020 as part of the overall Consolidated Appropriations Act, 2021, and related administrative rules and guidance issued by the Small Business Administration (SBA). In this article, we address frequently asked questions and guidance regarding the initial PPP loans taken out by Borrowers (First Draw Loans).
In civil disputes — including bankruptcy litigation — it is not uncommon for questions to arise about a client’s potential exposure to criminal liability, whether the client is a party or a witness. Civil litigators must therefore understand the role of the Fifth Amendment privilege against self-incrimination in the civil context.
The U.S. Court of Appeals for the Eleventh Circuit recently affirmed the dismissal of a borrower’s petition seeking relief under the federal All Writs Act for purported violations of the automatic bankruptcy stay in continued foreclosure proceedings and purported violations of the borrower’s rights to remove the state court proceedings to the bankruptcy court.
A year ago, many predicted that the COVID-19 stay-at-home orders and social distancing guidelines and their impact on the economy would result in a deluge of bankruptcy filings that could rival the Great Recession of 2008-2009. However, as we approach the one-year anniversary of former President Trump declaring the SARS-CoV-2 novel coronavirus a national emergency, that prediction has not come to pass.
Both creditors and debtors need to know about unsecured creditors committees. These committees can help parties in a bankruptcy case, but they come with a cost. And most of the time, they’re appointed as a matter of course.
What is an unsecured creditors committee?
Early evening on February 23, 2021, Belk Inc. and its affiliates (collectively, “Belk”) filed their Chapter 11 bankruptcy petitions in the Bankruptcy Court for the Southern District of Texas. Less than seventeen hours later, Judge Marvin Isgur confirmed Belk’s pre-packed plan of reorganization. Belk is not the first Chapter 11 bankruptcy case to accomplish plan confirmation within the first twenty-four hours after filing a petition, and it certainly won’t be the last. In 2019, Sungard Availability Services Capital, Inc.
On January 14, 2021, the U.S. Supreme Court decided City of Chicago, Illinois v. Fulton (Case No. 19-357, Jan. 14, 2021), a case which examined whether merely retaining estate property after a bankruptcy filing violates the automatic stay provided for by §362(a) of the Bankruptcy Code. The Court overruled the bankruptcy court and U.S. Court of Appeals for the Seventh Circuit in deciding that mere retention of property does not violate the automatic stay.
Case Background
Soon after Congress passed the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) in March 2020, the Criminal Division of the U.S. Department of Justice (DOJ) moved quickly to address potential COVID-19 related fraud. One area of early focus was the Paycheck Protection Program (PPP), a program under the CARES Act that provides loans to small businesses to help pay employees. The Fraud Section set up a team devoted to PPP fraud and, within two months of the passage of the CARES Act, had charged several individuals.