Bankruptcy Court ‘Venue Shopping’ Targeted by Bipartisan Bill

Companies facing bankruptcy would face another challenge under a bipartisan proposal in the U.S. House -- less flexibility in choosing where to file Chapter 11.

Legislation introduced Monday by Democrat Zoe Lofgren and Republican Ken Buck targets “venue shopping” and would require bankruptcy proceedings to take place where a company’s headquarters or most significant asset is located. The bill would prevent companies from “running off to a court across the country,” Colorado’s Buck said in a statement.

Congress has attempted to tackle the issue before, saying companies try to find friendly courts. Republican Senator John Cornyn and Democratic Senator Elizabeth ...