Consumer Protection and Corporate Accountability in Bankruptcy...
To amend title 11, United States Code, to make the filing of a petition for relief under chapter 11 that is objectively futile or in subjective bad faith a cause for dismissal of the case, and for other purposes.
This bill aims to change bankruptcy laws by making it easier to dismiss a company's request for Chapter 11 bankruptcy if the request is found to be without merit or made in bad faith. The bill's goal is to ensure that bankruptcy courts focus on legitimate cases and prevent companies from abusing the bankruptcy process.
If passed, the bill would affect businesses and individuals who file for Chapter 11 bankruptcy. It would allow courts to dismiss cases more quickly if they determine that the filings are not based on valid reasons. This could help protect creditors and other stakeholders by ensuring that bankruptcy proceedings are only used in genuine cases of financial distress.
The bill was introduced on April 20, 2026, and has been referred to the House Committee on the Judiciary for further review. There have been no significant actions on the bill yet, but it is in the early stages of the legislative process.
