[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 8589 Introduced in House (IH)]
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119th CONGRESS
2d Session
H. R. 8589
To amend title 11 of the United States Code to address misuse of
bankruptcy proceedings in cases of child sex abuse, and for other
purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
April 29, 2026
Ms. Ross (for herself, Ms. Tenney, Mrs. Sykes, and Ms. De La Cruz)
introduced the following bill; which was referred to the Committee on
the Judiciary
_______________________________________________________________________
A BILL
To amend title 11 of the United States Code to address misuse of
bankruptcy proceedings in cases of child sex abuse, and for other
purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Closing Bankruptcy Loopholes for
Child Predators Act of 2026''.
SEC. 2. AMENDMENTS.
(a) Amendments.--Title 11, United States Code, is amended--
(1) in section 101--
(A) by redesignating paragraphs (51B), (51C), and
(51D) as paragraphs (51C), (51D), and (51E),
respectively, and
(B) by inserting after paragraph (51A) the
following:
``(51B) The term `sexual abuse of a child' means any act
that--
``(A) constitutes a violation of--
``(i) section 1589, 1590, 1591, 2241(c),
2242, 2243, 2251, 2251A, 2252, 2252A, 2260,
2421, 2422, or 2423, 2258, or 2258A, of title
18;
``(ii) section 20341 of title 34; or
``(iii) a non-Federal law that is similar
to a law described in clause (i); and
``(B) by reason of the conduct prohibited, a person
who, while a minor, was aggrieved.'';'';
(2) in section 1109--
(A) by adding at the end of subsection (b) the
following:
``In any case in which a claim is filed against the debtor arising out
of the alleged sexual abuse of a child, the court shall hold a
conference within 60 days of the deadline by which proofs of claim must
be filed to consider victim impact statements.''.
(B) by adding at the end the following:
``(c) The sole purpose of victim impact statements shall be to
increase engagement and understanding between the bankruptcy court and
victims or survivors of child sexual assault. To encourage candor, and
thus enhance the utility of victim impact statements, the information
provided through victim impact statements is not, and shall not be used
as, evidence by any person in the case.'';
(3) in section 1101--
(A) in paragraph (2) by striking the period at the
end and inserting ``; and'', and
(B) by adding at end the following:
``(3) `victim impact statement' means a voluntary written,
oral, video, or audio statement, submitted to, or presented to
the court in the name of the victim or under a pseudonym,
describing the emotional, physical, familial, or financial
impact suffered as a result of the sexual abuse of the victim
who is a creditor of the debtor in a chapter 11 proceeding.'';
(4) in section 541 by adding at end the following:
``(g) In all cases regarding debts or other financial liability
arising from allegations of sexual abuse of a child and involving
debtors that are organizations described in section 501(c)(3) of the
Internal Revenue Code of 1986 and exempt from tax under section 501(a)
of such Code, the Court shall engage the services of an independent
forensic accountant to review the assets and interests of such debtor,
and any nondebtor sought to be released from liability in a proposed
reorganization plan, and require preparation of a report to assist the
Court with ensuring that such assets and interests are properly
included or excluded from the estate.'';
(5) in section 107--
(A) in subsection (b) by adding at the end the
following:
``(4) This subsection shall not apply to cases regarding
debts or other financial liability arising from potential
liability stemming from allegations of sexual abuse of a child
except to the extent necessary to protect the identity and
personal information of the individual alleging to have been
abused unless the alleged offender is found not guilty of abuse
in a court of law.''; and
(B) by adding at the end the following:
``(d) No court order shall seal any evidence of alleged crimes
relating to the sexual abuse of a child other than to protect the
identity and personal information of the individual alleging to have
been abused unless the alleged offender is found not guilty of abuse in
a court of law.'';
(6) in section 362(b)(2)(A)--
(A) in clause (iv) by striking ``or'' at the end;
(B) in clause (v) by adding ``or'' at the end; and
(C) by adding at end the following:
``(vi) concerning the sexual abuse of a
child or related claims;'';
(7) in section 524(g)(2)(B)--
(A) in clause (i) by inserting ``or relating to the
sexual abuse of a child:'' after ``reorganization'';
(B) after clause (ii) by adding the following:
``(iii) Notwithstanding any provision of
law to the contrary, in any case regarding
potential debts or other financial liabilities
arising from allegations of sexual abuse of a
child--
``(I) No third-party release shall
be approved by the court without
affirmative consent of both the debtor
and at least ninety percent of the
creditors in interest entitled to vote
and who do vote. The court shall ensure
that the parties have been given
adequate notice and opportunity to
provide or withhold such consent.
``(II) Any third-party seeking the
benefit of a release under this chapter
shall provide sufficient information to
allow an average creditor to make an
informed decision about the release.'';
(C) in clause (ii)--
(i) by striking ``subject'' and all that
follows through ``that--'' and inserting the
following:
``except in the case of a plan reorganization filed by
a debtor organized described in section 501(c)(3) of
the Internal Revenue Code of 1986 and exempt from tax
under section 501(a) of such Code to resolve claims
alleging sexual abuse of a child, subject to subsection
(h), the court determines that--''; and
(ii) by amending subclause (IV)(bb) to read
as follows:
``(bb) a separate class or
classes of claimants whose
claims are to be addressed by a
trust described in clause (i)
is established and votes, by at
least 75 percent of those
voting, in favor of the plan
or, if the debtor is an
organization described in
section 501(c)(3) of the
Internal Revenue Code of 1986
and exempt from tax under
section 501(a) of such Code
which has filed a case under
chapter 11 of this title to
resolve claims alleging sexual
abuse of a child, by at least
90 percent of a separate class
or classes of the claimants
whose claims are to be
addressed by a trust described
in clause (i).'';
(D) by adding at the end of section
524(g)(4)(A)(ii) the following:
``(V) the third party being an
affiliate of the debtor.''; and
(E) by adding at the end of section 524(g)(1)(C)
the following:
``Notwithstanding any other provision of this chapter,
if the debtor is an organization described in section
501(c)(3) of the Internal Revenue Code of 1986 and
exempt from tax under section 501(a) of such Code which
has filed for a case under chapter 11 of this title to
resolve claims alleging sexual abuse of a child, any
third party who is identifiable from the terms of a
plan of reorganization (by name or as part of an
identifiable group) and is alleged to be directly or
indirectly liable for the conduct of, claims against,
or demands on the debtor, may be released from such
liability if a separate class or classes of the
claimants whose claims are to be addressed by a trust
described in clause (i) is established votes, by at
least 90 percent of those voting, in favor of the
plan.'';
(8) in section 1111 by adding at the end the following:
``(c) Claims relating to sexual abuse of a child are deemed timely
filed regardless of and notwithstanding the State statute of limitation
otherwise applicable to the claims'';
(9) in section 523(a)(20)--
(A) by designating subsections (b), (c), (d), and
(e) as subsections (c), (d), (e), and (f),
respectively; and
(B) by adding after subsection (a) the following:
``(b) No debtor shall receive a discharge under section 727, 1141,
1192 [1] 1228(a), 1228(b), or 1328(b) of this title, or qualify for any
form of discharge, injunction, or release under a plan of
reorganization or otherwise, with respect to any claim or debt arising
from the sexual abuse of a minor in instances where such debtor was
either responsible for the sexual abuse of a minor directly or acted
with gross negligence for the safety of the abused minor(s) at issue.
This shall apply to all debtors regardless of whether such debtors are
an individual, a corporation. a limited partnership, a nonprofit
entity, or any other person or entity seeking relief under this
title.'' and
(10) in section 1181 by adding at the end the following:
``(d) Prohibition on Claims Related to Child Sexual Abuse.--
Notwithstanding any other provision of law, no subchapter 5 filings
shall be permitted for claims arising from or related to child sexual
abuse.''.
(b) Clerical Amendment.--The table of sections for chapter 1 of
title 11, United States Code, is amended by adding at the end the
following:
``113. Suspension of stay without consent.''.
SEC. 3. AMENDMENTS TO THE FEDERAL RULES OF BANKRUPTCY PROCEDURE.
The Federal Rules of Bankruptcy Procedure (11 U.S.C. app.) are
amended--
(1) in rule 2004--
(A) by striking the period at the end of (b)(2)(C)
and inserting ``; and'';
(B) by adding after (b)(2)(C) the following:
``(D) In a reorganization case under chapter 11 of
the Code related to the alleged sexual abuse of a
child, the examination shall also relate to the abuse
allegations against the debtor and any affiliated
entity, remedial policies and responses to those
allegations, information on the debtor or an affiliated
entity's finances and financial projections, and any
other matter relevant to the case or to the formulation
of a plan.''; and
(C) by adding at the end of subsection (c) the
following:
``In a reorganization case under chapter 11 of the Code related to the
alleged sexual abuse of a child, debtor attendance for examination and
the production of documents or electronically stored information is
required.''; and
(2) in rule 9018 by adding at the end the following:
``(c) In no respect shall any court order seal any evidence of
alleged crimes relating to the sexual abuse of a child other than to
protect the identity and personal information of the individual
alleging to have been abused unless the alleged offender is found not
guilty of abuse in a court of law.''.
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