Bankruptcy Venue Reform Act
Sponsored By: Representative Lofgren
Introduced
Summary
Curb forum shopping in Chapter 11 by locking venue to districts with a real connection to the debtor. This bill would rewrite venue rules to confine Chapter 11 cases to districts tied to a debtor's domicile, principal place of business, or principal assets and would streamline change-of-venue procedures to limit tactical filings.
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Bill Overview
Analyzed Economic Effects
3 provisions identified: 1 benefits, 0 costs, 2 mixed.
Faster, stricter venue disputes in court
If enacted, the bill would speed up and tighten venue fights in bankruptcy cases. If a case is filed in the wrong district, the court would have to either dismiss it immediately or, if justice requires, transfer it right away to a district where it could have been filed. The party that started the case would have to prove by clear and convincing evidence that venue is proper when certain objections or change requests are made. A court could also transfer a case for the interest of justice or for convenience even if it was filed in a correct district. The court would have to grant or deny any venue objection or change request within 14 days of filing.
Limits on where bankruptcies can be filed
If enacted, the bill would narrow the districts where Chapter 11 cases may start. For the 180 days before filing, individuals could file only where their U.S. domicile, residence, or main U.S. assets were located for the most days. Businesses could file only where their principal place of business or main U.S. assets were located for the most days in that 180-day window. Cash and cash equivalents would not count as "principal assets." Equity in an affiliate would be treated as located where the equity holder’s U.S. principal place of business (or an individual holder’s U.S. domicile or residence) was located. Venue could also be proper where a properly filed affiliate’s Title 11 case is pending if that affiliate owns or controls 50% or more of the debtor. Changes in ownership or transfers of the main place or assets that happened within one year before filing, or that were made to set venue, would not count.
Government attorneys may appear without local counsel
If enacted, the bill would direct the Supreme Court to make rules letting attorneys for government units appear and intervene in bankruptcy cases without hiring local counsel or paying extra appearance charges. This would apply in bankruptcy courts, district courts, and bankruptcy appellate panels for cases under Title 11 or related proceedings.
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Sponsors & CoSponsors
Sponsor
Lofgren
CA • D
Cosponsors
Cline
VA • R
Sponsored 3/26/2026
Roll Call Votes
No roll call votes available for this bill.
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