Partnership and LLC Bankruptcies: Unique Legal Issues and Recent Case Law Developments
Recording of a 90-minute CLE video webinar with Q&A
This CLE course will guide practitioners through unique issues when partnerships, limited liability companies, or their partners and members file bankruptcy. The panel will address topics in recent partnership bankruptcy cases and how courts cope with the lack of specific Bankruptcy Code provisions addressing such entities. The panel will also preview the issues in Bartenwerfer v. Buckley, U.S. Case No. 21-908, in which the U.S. Supreme Court will consider whether a debt can be non-dischargeable based on when it was incurred through the actions of a business partner without the debtor's knowledge.
Outline
- A bankruptcy filing by the partnership or LLC entity
- The statutory and contractual authority of partners to file a voluntary or involuntary petition on behalf of or against the entity
- Definition of "insolvent"
- Effect of the entity's automatic stay upon creditor claims against general partners personally
- Rights of an entity or its creditors against partners for fraudulent conveyances and violations of fiduciary duties
- Issues arising from recent high-profile law firm bankruptcies
- IRS ruling regarding COD income for partners resulting from cancellation of the partnership's debt in bankruptcy
- A bankruptcy filing by a partner or LLC member
- Continuity of the partnership
- Enforceability of certain ipso facto clauses
- Nature of the partnership agreement as an executory contract
- Transferability of the debtor's economic interest in the partnership or LLC
- Preview of Bartenwerfer v. Buckley, U.S. Case No. 21-908
Benefits
The panel will review these and other crucial questions:
- Who has the authority to put a general or limited partnership, a limited liability partnership, or an LLC into bankruptcy?
- Will the bankruptcy of a partner cause a dissolution of the partnership or partnership-like entity, preventing it from filing bankruptcy?
- What conflicts of interest does a general partner have in personally filing for bankruptcy or deciding whether to put a partnership or a partnership-like entity into bankruptcy?
Faculty
Evan T. Miller
Partner
Saul Ewing
Mr. Miller is a member of the firm's Bankruptcy & Restructuring Practice, where he handles corporate... | Read More
Mr. Miller is a member of the firm's Bankruptcy & Restructuring Practice, where he handles corporate bankruptcy and restructuring matters for debtors (including under Subchapter V) and trustees. His representations also include official committees of unsecured creditors, asset purchasers, vendors and landlords. Clients in industries including blockchain/cryptocurrency, technology, insurance, restaurants, retail, health care and aviation look to Mr. Miller to counsel them regarding corporate restructurings, both in and out of court. His work with cryptocurrency/blockchain matters includes advice on the treatment of digital assets in bankruptcy, including Bitcoin and non-fungible tokens (NFTs).
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William Smelko
Partner
Procopio Cory Hargreaves & Savitch
Mr. Smelko brings more than thirty-five years of experience to his representation of clients in litigation, with an... | Read More
Mr. Smelko brings more than thirty-five years of experience to his representation of clients in litigation, with an emphasis on business bankruptcy, restructuring and corporate governance disputes. He has successfully litigated all aspects of bankruptcy matters from both the creditor’s and debtor’s perspective. Mr. Smelko's practice also involves advising banks, credit unions and other financial institutions on a variety of bankruptcy related matters, including plan confirmation objections, asset disposition and use motions, stay relief litigation, lease disputes and the prosecution and defense of discharge objections and nondischargeability complaints. He has successfully argued a number of appeals before the Ninth Circuit Court of Appeals and California's Fourth District Court of Appeal. Mr. Smelko teaches Bankruptcy, Bankruptcy Procedure and Workouts, Collections & Foreclosures at the Thomas Jefferson School of Law while also coaching Thomas Jefferson's Bankruptcy Law Moot Court and Negotiation Teams.
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