bankruptcy proceeding even though the debtor's foreign representative was appointed by the foreign debtor's manager pursuant to a power of attorney ("PoA") rather than an order of the foreign court. According to the U.S. bankruptcy court, because the Bulgarian debtor was the functional equivalent of a DIP with the power to appoint foreign representatives, the individual appointed by the debtor in the PoA as its "foreign representative" qualified as such for purposes of chapter 15 eligibility and recognition. Recognition of Foreign Bankruptcy Cases Under Chapter 15Chapter 15 was enacted in 2005 to govern cross-border bankruptcy and insolvency proceedings. It is patterned on the 1997 UNCITRAL Model Law on Cross-Border Insolvency (the "Model Law"), which has been enacted in some form by more than 50 countries.Under section 1515(a) of the Bankruptcy Code, the representative of a foreign debtor may file a petition in a U.S. bankruptcy court seeking "recognition" of a "foreign proceeding." Section 101(24) of the Bankruptcy Code defines "foreign representative" as "a person or body, including a person or body appointed on an interim basis, authorized in a foreign proceeding to administer the reorganization or the liquidation of the debtor's assets or affairs or to act as a representative of such foreign proceeding." The Bankruptcy Code defines "person" to include an "individual." See 11 U.S.C. § 101(41).Section 1515(b) provides that:A petition for recognition shall be accompanied by—(1) a certified copy of the decision commencing such foreign proceeding and appointing the foreign representative;(2) a certificate from the foreign court affirming the existence of such foreign proceeding and of the appointment of the foreign representative; or(3) in the absence of evidence referred to in paragraphs (1) and (2), any other evidence acceptable to the court of the existence of such foreign proceeding and of the appointment of the foreign representative. 11 U.S.C. § 1515(b) (emphasis added).Under section 1516(a), "[i

limitations on a bankruptcy trustee's avoidance powers, which include the power to avoid certain preferential and fraudulent transfers. Section 546(e) provides that the trustee may not avoid, among other things, a pre-bankruptcy transfer that is a settlement payment "made by or to (or for the benefit of) a … financial institution [or a] financial participant …, or that is a transfer made by or to (or for the benefit of)" any such entity in connection with a securities contract, "except under section 548(a)(1)(A) of the [Bankruptcy Code]." Thus, the section 546(e) "safe harbor" bars avoidance claims challenging a qualifying transfer unless the transfer was made with actual intent to hinder, delay, or defraud creditors under section 548(a)(1)(A), as distinguished from being constructively fraudulent under section 548(A)(1)(B) because the debtor was insolvent at the time of the transfer (or became insolvent as a consequence) and received less than reasonably equivalent value in exchange.Section 101(22) of the Bankruptcy Code defines the term "financial institution" to include, in relevant part:[A] Federal reserve bank, or an entity that is a commercial or savings bank, industrial savings bank, savings and loan association, trust company, federally-insured credit union, or receiver, liquidating agent, or conservator for such entity and, when any such Federal reserve bank, receiver, liquidating agent, conservator or entity is acting as agent or custodian for a customer (whether or not a "customer", as defined in section 741) in connection with a securities contract (as defined in section 741) such customer….11 U.S.C. § 101(22). "Customer" and "securities contract" are defined broadly in sections 741(2) and 741(7) of the Bankruptcy Code, respectively. Section 741(8) defines "settlement payment" as "a preliminary settlement payment, a partial settlement payment, an interim settlement payment, a settlement payment on account, a final settlement payment, or any other similar payment commonly used in the securit

the financial woes of health care providers can be attributed to a number of factors, including: increased competition; capital market constraints; labor disputes; the need for investment in additional personnel and technology; the erosion of profitability due to the evolution from a "fee for service" payment model to a "bundle of services" payment model; liquidity problems caused by government payment disputes; operational changes; and increased pharmaceutical and other supply cost pressures. These and other factors (e.g., the highest inflation rate in four decades at the end of 2022) have led an increasing number of financially distressed providers to consider bankruptcy as a vehicle for effectuating closures, consolidation, restructurings, and related transactions.Appointment of Patient Care Ombudsmen in Health Care Business Bankruptcy CasesCertain provisions were added to the Bankruptcy Code in 2005 that deal specifically with a debtor that is a "heath care business."Among them is section 101(27A) of the Bankruptcy Code, which provides that a "health care business":(A) means any public or private entity (without regard to whether that entity is organized for profit or not for profit) that is primarily engaged in offering to the general public facilities and services for—(i) the diagnosis or treatment of injury, deformity, or disease; and(ii) surgical, drug treatment, psychiatric, or obstetric care; and(B) includes—(i) any—(I) general or specialized hospital;(II) ancillary ambulatory, emergency, or surgical treatment facility;(III) hospice;(IV) home health agency; and(V) other health care institution that is similar to an entity referred to in subclause (I), (II), (III), or (IV); and(ii) any long-term care facility, including any—(I) skilled nursing facility;(II) intermediate care facility;(III) assisted living facility;(IV) home for the aged;(V) domiciliary care facility; and(VI) health care institution that is related to a facility referred to in subclause (I), (II), (III), (IV), or (V), if that ins

This was made possible by the bipartisan legislation known as the Small Business Reorganization Act of 2019 (SBRA).1 Small Business Reorganization Act (SBRA) of 2019, Pub. L. No. 11654, 133 Stat. 1079. Unless otherwise stated, all statutory references are to the Bankruptcy Code, 11 U.S.C. §§101 et seq. The SBRA was enacted to provide small business debtors2 Defined in §101 (51D) as a person (1) engaged in a commercial business activity, excluding the ownership of single asset real estate as defined in 11 U.S.C. §101 (51B), (2) non-contingent liquidated secured and unsecured debt as of the date of the filing of the petition not more than $2,725,625.00 (excluding debts owing to affiliates and insiders), and (3) the majority of such debts must have arisen from the commercial or business activities of the debtor.

As the Indian gaming industry continues to thrive, Indian tribes are increasingly engaging in other commercial endeavors including banking, construction, energy, telecommunications, manufacturing, retail and more. Based on a long line of Supreme Court precedent, Indian tribes are generally immune from the federal and state laws that regulate and give rise to liability in these industries, absent an express waiver of this immunity. But in recent years, the propriety of tribal sovereign immunity in this changing economic reality has come into question. In particular, federal courts are in disagreement over whether tribal sovereign immunity extends to the bankruptcy context, as highlighted by a recent decision from the United States District Court for Eastern Michigan (District Court).[1] On June 9, 2015, the District Court held that Congress did not clearly, unequivocally and unmistakably express an intent to abrogate the sovereign immunity of Indian tribes in sections 106(a) and 101(27) of the Bankruptcy Code, reversing the decision of the United States Bankruptcy Court for Eastern Michigan (Bankruptcy Court) below. The District Court then remanded the matter to the Bankruptcy Court on the issue of whether the appellants nevertheless waived their sovereign immunity by participating in the bankruptcy proceeding. The case began in the bankruptcy proceeding of a Detroit hotel and casino. The creditors’ committee (which was later substituted by the litigation trustee) brought an adversary proceeding against the Sault Ste. Marie Tribe of Chippewa Indians and Kewadin Casinos Gaming Authority (Tribe), among other defendants, alleging $177 million in fraudulent transfers under sections 544 and 550 of the Bankruptcy Code and Michigan state law. The Tribe moved to dismiss the fraud claims based on sovereign immunity. The litigation trustee opposed dismissal, arguing that tribal sovereign immunity is expressly abrogated under the Bankruptcy Code. Specifically, section 106(a) of the Bankruptcy Code

The Trustee had argued that the definition of “financial participant” cannot include the debtor itself, since the term is defined as “an entity” that holds requisite contracts in requisite amounts with “the debtor or any other entity.” 11 U.S.C. §101(22A) (emphasis added). If a debtor could be considered a “financial participant,” the “with the debtor” language in Bankruptcy Code § 101(22A) would be redundant or superfluous because Congress only needed to state that the agreements could be “with any other entity.”

trustee's avoidance powers, which include the power to avoid certain preferential and fraudulent transfers. Section 546(e) provides that the trustee may not avoid, among other things, a pre-bankruptcy transfer that is a settlement payment "made by or to (or for the benefit of) a … financial institution [or a] financial participant …, or that is a transfer made by or to (or for the benefit of)" any such entity in connection with a securities contract, "except under section 548(a)(1)(A) of the [Bankruptcy Code]." Thus, the section 546(e) "safe harbor" bars avoidance claims challenging a transfer falling under the subsection's terms unless the transfer was made with actual intent to hinder, delay, or defraud creditors under section 548(a)(1)(A), as distinguished from constructively fraudulent transfers under section 548(A)(1)(B), where the debtor is insolvent at the time of the transfer (or becomes insolvent as a consequence) and receives less than reasonably equivalent value in exchange.Section 101(22) of the Bankruptcy Code defines the term "financial institution" to include, in relevant part:[A] Federal reserve bank, or an entity that is a commercial or savings bank, industrial savings bank, savings and loan association, trust company, federally-insured credit union, or receiver, liquidating agent, or conservator for such entity and, when any such Federal reserve bank, receiver, liquidating agent, conservator or entity is acting as agent or custodian for a customer (whether or not a "customer", as defined in section 741) in connection with a securities contract (as defined in section 741) such customer ….11 U.S.C. § 101(22). "Customer" and "securities contract" are defined broadly in sections 741(2) and 741(7) of the Bankruptcy Code, respectively. Sections 101(51A) and 741(8) define the term "settlement payment."According to the legislative history of section 546(e), the purpose of the safe harbor is to prevent "the insolvency of one commodity or security firm from spreading to other firms and possibly

uptcy Code, including actions to enforce the automatic stay, preference and fraudulent transfer avoidance actions, and proceedings seeking to establish the dischargeability of a debt.Furthermore, pursuant to section 106(b) of the Bankruptcy Code, a governmental unit that files a proof of claim in a bankruptcy case "is deemed to have waived sovereign immunity with respect to a claim against such governmental unit that is property of the estate and that arose out of the same transaction or occurrence out of which the claim of such governmental unit arose."Section 101(27) of the Bankruptcy Code defines the term "governmental unit" as:United States; State; Commonwealth; District; Territory; municipality; foreign state; department, agency, or instrumentality of the United States (but not a United States trustee while serving as a trustee in a case under this title), a State, a Commonwealth, a District, a Territory, a municipality, or a foreign state; or other foreign or domestic government.11 U.S.C. § 101(27) (emphasis added).In July 2019, the debtor took out a payday loan from an indirect subsidiary of the Lac du Flambeau Band of Lake Superior Chippewa Indians (the "Band"). Later that year, the debtor filed a chapter 13 petition in the District of Massachusetts.After the lender repeatedly contacted the debtor seeking repayment of the debt despite the automatic stay, the debtor sought an order from the bankruptcy court enforcing the automatic stay against both the lender and its corporate parents, including the Band. In response, the Band and its affiliates asserted tribal sovereign immunity and moved to dismiss the enforcement proceeding. The bankruptcy court agreed with the Band and granted the motion to dismiss. The First Circuit permitted a direct appeal from that decision.A divided three-judge panel of the First Circuit reversed on appeal, concluding that Congress unequivocally abrogated the tribal sovereign immunity in section 106(a) of the Bankruptcy Code because a Native American t

kruptcy and insolvency proceedings. It is patterned on the 1997 UNCITRAL Model Law on Cross-Border Insolvency (the "Model Law"), which has been enacted in some form by more than 50 countries.Both chapter 15 and the Model Law are premised upon the principle of international comity, or "the recognition which one nation allows within its territory to the legislative, executive or judicial acts of another nation, having due regard both to international duty and convenience, and to the rights of its own citizens or of other persons who are under the protection of its laws." Hilton v. Guyot, 159 U.S. 113, 164 (1895). Chapter 15's stated purpose is "to provide effective mechanisms for dealing with cases of cross-border insolvency" with the objective of, among other things, cooperation between U.S. and non-U.S. courts.Under section 1515 of the Bankruptcy Code, the representative of a foreign debtor may file a petition in a U.S. bankruptcy court seeking "recognition" of a "foreign proceeding." Section 101(24) of the Bankruptcy Code defines "foreign representative" as "a person or body, including a person or body appointed on an interim basis, authorized in a foreign proceeding to administer the reorganization or the liquidation of the debtor's assets or affairs or to act as a representative of such foreign proceeding."The basic requirements for recognition under chapter 15 are outlined in section 1517(a), namely: (i) the proceeding must be "a foreign main proceeding or foreign nonmain proceeding" within the meaning of section 1502; (ii) the "foreign representative" applying for recognition must be a "person or body"; and (iii) the petition must satisfy the requirements of section 1515, including that it be supported by the documentary evidence specified in section 1515(b)."Foreign proceeding" is defined in section 101(23) of the Bankruptcy Code as:[A] collective judicial or administrative proceeding in a foreign country, including an interim proceeding, under a law relating to insolvency or adjustment of debt in

Under section 1515, the "foreign representative" of a foreign "debtor" may file a petition in a U.S. bankruptcy court seeking "recognition" of a "foreign proceeding."Section 1502 provides that "for the purposes of [chapter 15] … 'debtor' means an entity that is the subject of a foreign proceeding."However, section 101 of the Bankruptcy Code also includes a definition of the term "debtor," and section 109 limits the entities that can qualify as a debtor. Section 101(13) provides that "debtor" means "person or municipality concerning which a case under this title has been commenced."