Senate Proposal Would Limit Where Companies Can File Bankruptcy

Bipartisan legislation introduced in the U.S. Senate proposes to rewrite rules on where bankruptcy cases can be filed to prevent large corporations from ‘forum shopping,’ or choosing courts most advantageous to their interests.

The Bankruptcy Venue Reform Act of 2017 (S. 2282) would hit New York and Delaware hard as venues for big case reorganizations and aims to make the process more accessible to smaller players in large bankruptcies.

The measure was introduced Jan. 8 by John Cornyn (R-Texas) and Sen. Elizabeth Warren (D-Mass), who is a former bankruptcy law scholar.

“This bill is about big cases; that’s ...