IB Union Calendar No. 20 111th CONGRESS 1st Session H. R. 1575 [Report No. 111–50] IN THE HOUSE OF REPRESENTATIVES March 17, 2009 Mr. Conyers (for himself, Mr. Cohen, Mr. Nadler of New York, Mr. Delahunt, Mr. Johnson of Georgia, Mr. Pierluisi, Ms. Fudge, and Mr. Tonko) introduced the following bill; which was referred to the Committee on the Judiciary March 24, 2009 Additional sponsors: Ms. Wasserman Schultz, Mr. Boswell, Mr. Baca, Ms. Jackson-Lee of Texas, Ms. Eshoo, Ms. Hirono, and Mr. Sherman March 24, 2009 Committed to the Committee of the Whole House on the State of the Union and ordered to be printed A BILL To authorize the Attorney General to limit or recover excessive compensation paid or payable by entities that have received Federal financial assistance on or after September 1, 2008.

1.

Short title

This Act may be cited as the End Government Reimbursement of Excessive Executive Disbursements (End GREED) Act.

2.

Statement of authority

Congress hereby elects to use its authority under article I, section 8, clause 4, and article I, section 8, clause 18, of the Constitution— (1)to establish a uniform law on bankruptcy that applies to entities that have received extraordinary financial assistance from the United States on or after September 1, 2008, and (2)to authorize the Attorney General of the United States (hereinafter in this Act referred to as the Attorney General), after consultation with the Secretary of the Treasury (hereinafter in this Act referred to as the Secretary)— (A)to seek recovery of previous excessive payments of compensation made by such entities after receiving such assistance, and (B)to limit excessive payments of compensation to be made by such entities.

3.

Recovery of excessive compensation

(a)

Review of contracts and payments

The Attorney General, after consultation with the Secretary, on behalf of the Government may review any employment contract made by a recipient entity, and any payment made on or after September 1, 2008, by a recipient entity to an employee. (b)

Civil action for fraudulent transfer

The Attorney General may commence a civil action in an appropriate district court of the United States to avoid any payment made by a recipient entity to an employee (including a payment under an employment contract) that was made on or after September 1, 2008, if such entity received less than a reasonably equivalent value in exchange for such payment and such entity— (1)was insolvent on the date that such payment was made, not taking into account any— (A)line of credit, (B)loan, or (C)payment in exchange for stock of such entity, received by such entity from the United States on or after September 1, 2008, or(2)was engaged in business or a transaction, or was about to engage in business or a transaction, for which property remaining in the recipient entity was an unreasonably small capital. For purposes of this subsection, the Attorney General may avoid any transfer of an interest of a recipient entity in property, or any obligation incurred by such entity, that is avoidable under applicable law by a creditor holding an unsecured claim against such entity.(c)

Civil action To avoid contractual obligations To pay excessive compensation

The Attorney General may commence a civil action in an appropriate district court of the United States to limit the amount of the compensation paid or payable on or after the date of the enactment of this Act by a recipient entity under an employment contract if such compensation is greater than an amount equal to 10 times the amount of the mean amount of compensation paid or payable to nonmanagement employees of such entity for any purpose during the calendar year in which compensation was paid or payable by such entity.

4.

Subpoena authority

The Attorney General is authorized to issue a subpoena requiring the attendance and testimony of witnesses and the production of documentary evidence relating to any matter relevant to the implementation of this Act, including the circumstances surrounding any employment contract or payment of compensation, which subpoena, in the case of contumacy or refusal to obey, shall be enforceable by order of an appropriate district court of the United States.

5.

Rule of construction

Other than limiting compensation paid or payable under employment contracts or providing for the recovery of previously paid compensation, nothing in this Act shall be construed to have any impact on a recipient entity, its financial status, or the financial status of its creditors.

6.

Definitions

For purposes of this Act— (1)the term employment contract means an employment contract that provides for the payment of compensation (including performance or incentive compensation, a bonus of any kind, or any other financial return designed to replace or enhance incentive, stock, or other compensation), and (2)the term recipient entity means a person (including any subsidiary of such person) that receives, during any period beginning on or after September 1, 2008, from the United States— (A)a line of credit or a loan, (B)a payment in exchange for stock of such person (or such subsidiary), or (C)any combination of credit, loans, or payments, that exceeds $10,000,000,000 in the aggregate.

March 24, 2009 Committed to the Committee of the Whole House on the State of the Union and ordered to be printed