Unveiling a Flaw in the CARES Act: Joseph Orbach and Mark Power's article recognized in Best of ABI 2022

Joseph Orbach and Mark Power's article, "Not so Technical: A Flaw in the CARES Act's Correction to 'Small Business Debtor,'" was selected for inclusion in Best of ABI 2022: The Year in Business Bankruptcy.

Each year, the American Bankruptcy Institute (ABI) gathers the best ABI Journal articles to highlight the top trends in both business and consumer bankruptcy. This year, the list includes a comprehensive overview of the key fundamentals and topical issues of business bankruptcy, such as claims administration, involuntary bankruptcy considerations, subchapter V and more.

Mark and Joe, partners in the firm's Financial Restructuring and Bankruptcy group, published an article in the February 2022 issue of American Bankruptcy Institute Journal focusing on a flaw they identified in the way Congress had drafted exclusions to the definition of "small business debtor." In the article, Mark and Joe proposed specific language that they advocated Congress should adopt to amend the Bankruptcy Code in order to fix this flaw.  

The issue went from abstract to real world a few months later in a written opinion issued by a bankruptcy judge in the Central District of California on April 28, 2022. The authors examined this decision in detail in a blogpost on the firm's credit report blog. The opinion was the first reported decision addressing the highly technical flaw that was identified by Mark and Joe, and the decision discussed their ABI article in detail. 

As a result of the Act making the technical corrections to the Bankruptcy Code, raised early on by Mark and Joe in their article, Congress has now corrected a flaw, which will allow potentially significantly more debtors to utilize Subchapter V of the Bankruptcy Code to reorganize.

Thompson Coburn attorneys continue to be at the forefront of shaping and developing many areas of the law, including the highly technical aspects of the recent amendment to the Bankruptcy Code.