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'Watch Your Attitude, Petitioning Creditors!'
The Bankruptcy Code contains relatively clear and straightforward requirements and standards regarding the eligibility of creditors to file an involuntary bankruptcy petition against a debtor, as well as when an order for relief on such petition shall be ordered by the court. If such criteria are met, do the creditors' intentions, which are not specifically referenced in this context in the statutory framework, come into play at all?
In the recent case of In re Forever Green Athletic Fields, Inc., 804 F.3d 328 (3d Cir. 2015), the United States Court of Appeals for the Third Circuit held that, even if petitioning creditors and the debtor met the statutory prerequisites for involuntary bankruptcy relief, if the petitioning creditors had not acted in “good faith” in filing the petition, then the bankruptcy case should be dismissed and sanctions potentially awarded against the petitioning creditors. 804 F.3d at 333-35. This ruling could make pursuing involuntary bankruptcy a less attractive tactical alternative for creditors that are unsuccessful in attempting to collect upon unpaid claims and should certainly cause creditors to evaluate their and other petitioning creditors' motives (including prior conduct and statements) before commencing any involuntary bankruptcy proceedings.
The DOJ's Corporate Enforcement Policy: One Year Later
The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.
The DOJ's New Parameters for Evaluating Corporate Compliance Programs
The parameters set forth in the DOJ's memorandum have implications not only for the government's evaluation of compliance programs in the context of criminal charging decisions, but also for how defense counsel structure their conference-room advocacy seeking declinations or lesser sanctions in both criminal and civil investigations.
Use of Deferred Prosecution Agreements In White Collar Investigations
This article discusses the practical and policy reasons for the use of DPAs and NPAs in white-collar criminal investigations, and considers the NDAA's new reporting provision and its relationship with other efforts to enhance transparency in DOJ decision-making.
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
Compliance Officers: Recent Regulatory Guidance and Enforcement Actions and Mitigating the Risk of Personal Liability
This article explores legal developments over the past year that may impact compliance officer personal liability.