[Congressional Record Volume 164, Number 4 (Monday, January 8, 2018)]
[Senate]
[Page S68]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. CORNYN (for himself and Ms. Warren):
  S. 2282. A bill to amend title 28, United States Code, to modify 
venue requirements relating to bankruptcy proceedings; to the Committee 
on the Judiciary.
  Mr. CORNYN. Mr. President, I ask unanimous consent that the text of 
the bill be printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 2282

       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 ``Bankruptcy Venue Reform Act 
     of 2018''.

     SEC. 2. FINDINGS AND PURPOSE.

       (a) Findings.--Congress finds that--
       (1) bankruptcy law provides a number of venue options for 
     filing bankruptcy under chapter 11 of title 11, United State 
     Code, including place of incorporation, principal place of 
     business and assets, or where an affiliate has filed a case 
     under chapter 11;
       (2) the wide range of permissible bankruptcy venue options 
     has led to an increase in companies filing for bankruptcy 
     outside of their home States, or the district in which their 
     principal place of business or principal assets are located, 
     a practice known as forum shopping, and has resulted in a 
     concentration of bankruptcy cases in a few districts;
       (3) bankruptcy forum shopping prevents small businesses, 
     employees, retirees, creditors, and other important 
     stakeholders from fully participating in bankruptcy cases 
     that will have tremendous impacts on their lives, 
     communities, and local economies, and deprives district 
     courts of the United States of the opportunity to contribute 
     to the development of bankruptcy law in their jurisdictions; 
     and
       (4) reducing forum shopping and manipulation in the 
     bankruptcy system will strengthen the integrity, build public 
     confidence, and ensure fairness in the bankruptcy system.
       (b) Purpose.--The purpose of this Act is to prevent the 
     practice of forum shopping in cases filed under chapter 11 of 
     title 11, United States Code.

     SEC. 3. VENUE OF CASES UNDER TITLE 11.

       Title 28, United States Code, is amended--
       (1) by striking section 1408 and inserting the following:

     ``Sec. 1408. Venue of cases under title 11

       ``(a) Definition.--In this section, the term `principal 
     place of business' means, with respect to a person or entity 
     that is subject to the reporting requirements of section 13 
     or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 
     78m, 78o(d)), the address of the principal executive office 
     of the person or entity as stated in the last annual report 
     filed under that Act prior to the commencement of a case 
     under title 11 by the person or entity, unless another 
     address is shown to be the principal place of business by 
     clear and convincing evidence.
       ``(b) Venue.--Except as provided in section 1410, a case 
     under title 11 may be commenced only in the district court 
     for the district--
       ``(1) in which the domicile, residence, or principal assets 
     in the United States of an individual who is the subject of 
     the case have been located for the 180 days immediately 
     preceding such commencement, or for a longer portion of the 
     180-day period than the domicile, residence, or principal 
     assets in the United States of the individual were located in 
     any other district;
       ``(2) in which the principal assets or principal place of 
     business in the United States of a person or entity, other 
     than an individual, that is the subject of the case have been 
     located for the 180 days immediately preceding the 
     commencement, or for a longer portion of the 180-day period 
     than the principal place of business or principal assets in 
     the United States of the person or entity were located in any 
     other district; or
       ``(3) in which there is already pending a case under title 
     11 concerning an affiliate that directly or indirectly owns, 
     controls, is the general partner, or holds 50 percent or more 
     of the outstanding voting securities, of the person or entity 
     that is the subject of the later filed case if the pending 
     case was properly filed in that district under this section.
       ``(c) Limitations.--
       ``(1) In general.--For the purposes of paragraphs (2) and 
     (3) of subsection (b), no effect shall be given to a change 
     in the ownership or control of a person or entity that is the 
     subject of the case or its affiliate, or to a transfer of the 
     principal assets or principal place of business of a person 
     or entity that is the subject of the case or its affiliate to 
     another district, that takes place--
       ``(A) within 1 year before the date on which the case is 
     commenced; or
       ``(B) for the purpose of establishing venue.
       ``(2) Principal assets.--For the purposes of subsection 
     (b)(2) and paragraph (1) of this subsection, principal assets 
     do not include cash or cash equivalents.
       ``(d) Burden.--The person or entity that commences a case 
     under title 11 shall bear the burden of establishing by clear 
     and convincing evidence that venue is proper under this 
     section.''; and
       (2) by striking section 1412 and inserting the following:

     ``Sec. 1412. Change of venue

       ``Notwithstanding that a case or proceeding under title 11 
     is filed in the correct division or district, a district 
     court may nevertheless transfer a case or proceeding under 
     title 11 to a district court for another district or 
     division, in the interest of justice or for the convenience 
     of the parties. If a case or proceeding under title 11 is 
     filed in the wrong division or district, the district court 
     shall transfer, dismiss the case or proceeding, or, if it be 
     in the interest of justice, transfer the case or proceeding 
     under title 11 to any district or division in which it could 
     have been brought. The court shall enter an order on any 
     objection to or request to change venue of a case or 
     proceeding under title 11 not later than 14 days after the 
     filing of such objection or request.''.

                          ____________________