California-based companies are increasingly filing for bankruptcy outside the state, depriving local employees, vendors and creditors from participating in the bankruptcy process. In the Daily Journal article “It’s time for Congress to address bankruptcy venue,” authors SulmeyerKupetz Partner Elissa Miller, Greenberg Glusker Partner Brian Davidoff, and Danning Gill Partner Zev Shechtman, explained why Congress should reform the current bankruptcy venue laws and why they hinder due process.
“Applying general venue rules in bankruptcy makes sense as a matter of due process. People who are affected by a business bankruptcy should be able to personally participate in the process – not be forced to pay attorneys to represent their interests far from home,” Davidoff, Miller and Schechtman wrote.
Currently, there are 163 retired and current judges who sent a letter to Congress urging for reform and a bi-partisan bankruptcy bill was co-sponsored by Zoe Lofgren of California (D) and James Sensenbrenner of Wisconsin (R) to address these issues.
The article also noted that: “There should be no reason why our citizens should be deprived of due process, why our districts should lose revenues, and why judges on the other side of the country should be deciding the economic fate, indeed the health and welfare, of Californians.”
Read the Daily Journal article here.