A recent New York Times article highlights the challenges oftentimes faced by smaller vendors in large bankruptcy cases.  The article profiles a couple, who owns a warehouse leased to Brooks Brothers, who were left holding a $240,000 cleanup fee bill when Brooks Brothers rejected their warehouse lease and refused to clear the equipment and other materials being stored.  [The New York Times; April 2, 2021]

Bloomberg reports on Alpha Media's lawsuit against the Small Business Administration based on the administration's failure to allow for PPP loans to companies in bankruptcy.  Alpha Media, which filed for bankruptcy in January, contends that the SBA is rejecting PPP applications from debtors even though "it was not Congress' intent for the SBA to use an applicant's status as a Chapter 11 debtor as a basis to deny it PPP relief."  Several companies in bankruptcy have sued the SBA administrator with similar claims over the past year, with mixed results.  [Bloomberg Law; April 7, 2021]

Yahoo Finance reports that China Huarong Asset Management Co. is considering asset sales in an effort to avoid a wholescale restructuring. The state-owned manager of non-performing loans, which spooked investors earlier this month when it delayed its earnings report, is still determining which assets it might consider selling.  [Yahoo Finance; April 8, 2021]

Yahoo Finance also reports that the U.S. government posted a March budget deficit of $660 billion, a record high for the month and the third highest U.S. monthly budget deficit on record.  Much of the deficit resulted from payments under the recently-approved $1.9 trillion stimulus package and, with more funding from the stimulus package expected to roll out in coming months, U.S. Treasury officials expect deficit levels to remain elevated.  [Yahoo Finance; April 12, 2021]

Trial began in the National Rifle Association's bankruptcy on April 6 on motions seeking appointment of an examiner or an independent trustee over the NRA, or dismissal of the bankruptcy case entirely.  The Wall Street Journal reports that, in his testimony, NRA CEO Wayne LaPierre made headlines by acknowledging his failure to disclose overseas yacht trips, paid for by NRA vendors, and other potential conflicts of interest.  And Bloomberg Law reports that the NRA is seeking appointment of a chief restructuring officer to help it navigate bankruptcy and other possible reforms.  [The Wall Street Journal; April 7, 2021; Bloomberg Law; April 8, 2021]

Visit us at mayerbrown.com

Mayer Brown is a global legal services provider comprising legal practices that are separate entities (the "Mayer Brown Practices"). The Mayer Brown Practices are: Mayer Brown LLP and Mayer Brown Europe - Brussels LLP, both limited liability partnerships established in Illinois USA; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales (authorized and regulated by the Solicitors Regulation Authority and registered in England and Wales number OC 303359); Mayer Brown, a SELAS established in France; Mayer Brown JSM, a Hong Kong partnership and its associated entities in Asia; and Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. "Mayer Brown" and the Mayer Brown logo are the trademarks of the Mayer Brown Practices in their respective jurisdictions.

© Copyright 2020. The Mayer Brown Practices. All rights reserved.

This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.