An Illinois bankruptcy court was the first court in the country to issue an opinion on how a force majeure clause in a commercial lease would be applied to the COVID-19 pandemic. Not surprisingly, the language of the underlying force majeure clause and the Illinois’ Governor’s executive order played critical roles in the court’s analysis. As it turned out, take-out food saved the contract. The case involved a restaurant that [...]
Starting June 8, 2020, the US Bankruptcy Clerk’s Office will be open for public access. There are some requirements and restrictions on courthouse entry pursuant to US District Court's - District of Nebraska, General Order 2020-10 and 2020-11. Every person entering the courthouse will be asked if they have reviewed the posted risk factors and if any apply. If so, the individual will be barred from entering the courthouse, unless [...]
The risk of mass bankruptcies across the U.S. continues to rise as more companies grapple with the fallout stemming from efforts to battle the spread of coronavirus cases, according to one leading bankruptcy professor. According to data watched by NYU Stern School of Business professor emeritus Ed Altman, bankruptcy and default potential for high-yield companies doubled from 5% to 10% in just a few weeks. “Today, our numbers are showing a likely [...]
In August of last year Congress passed, and Mr. Trump signed, legislation to make Chapter 11 more helpful for “small business” debtors, “The Small Business Reorganization Act” (“Subchapter V”), see https://www.congress.gov/116/bills/hr3311/BILLS-116hr3311enr.pdf. Subchapter V became effective February 19th of this year. Principal changes for “small business” debtors which elect Subchapter V treatment include elimination of the “absolute priority rule” applicable to Chapter 11 plan confirmation (this rule generally precludes a Chapter [...]
Changes in the rules governing small business bankruptcies came at a fortuitous time earlier this year and could provide an easier path to reorganization as many more companies are likely to become insolvent due to the continued effects of the COVID-19 outbreak. In effect since mid-February, the Small Business Restructuring Act makes Chapter 11 proceedings faster, cheaper and more efficient for companies that come to court with debt loads below a new [...]
In an effort to reduce the spread of Covid-19, all Chapter 7, 11, 12, and 13 meetings of creditors scheduled after April 1, 2020 for all locations in Nebraska will be conducted by telephone until further notice. Debtors, attorneys, creditors, and others may not appear in person. Debtors, their counsel, and any creditors who wish to participate in any 341 meetings scheduled after April 1, 2020 must call the toll-free [...]
