Picking Bankruptcy Court Can Be Near Limitless in Virtual World

Bankrupt companies’ ability to select their preferred court for Chapter 11 protection is gaining strength, even as complaints of rampant judge shopping grow louder.

Decades-old bankruptcy venue rules appear ill-fitted to a post-Covid world where the physical ties—like corporate headquarters or office locations—long used to establish which court a business could file in matter less and less.

A judge’s ruling this month marked the second time this year that the government’s bankruptcy watchdog, the US Trustee, failed to convince a Texas court to move a Chapter 11 proceeding out of the state on the grounds that it lacked ties to ...