Rochelle's Daily Wire

Disputing the Fourth Circuit line by line and raising the possibility of a circuit split, the BAP and six bankruptcy courts have held that there’s no such thing as nondischargeability for corporate Sub V debtors.

Courts are split on whether the debt providing eligibility for Sub V must have arisen from a business that was active on the filing date.

Eighth Circuit BAP ‘at a minimum’ requires substantial changes in financial condition for a debtor to modify a confirmed chapter 12 plan.

The $7.5 million debt cap for Subchapter V doesn’t include the debt of affiliates who file later.

The business debt necessary to qualify for Subchapter V need not to have arisen from the debtor’s business at the time of filing, Bankruptcy Judge Meier says.

Contrary to the Fourth Circuit, five bankruptcy courts have now held there’s no such thing as nondischargeability for corporate Sub V debtors. The question is now before the Fifth Circuit.

In the Alex Jones corporate Subchapter V case, Bankruptcy Judge Christopher Lopez said that the later chapter 11 filing by Jones himself, with about $1.5 billion in debt, didn’t kick the corporate debtor out of Subchapter V and into ‘ordinary’ chapter 11.

A small business debtor must consent for a case to be converted to Subchapter V, Judge Robert Jones says.

A district judge in Florida upheld a Subchapter V plan that required automatic increases in payments to unsecured creditors based on actual disposable income.

Although deposed as debtor in possession, the Subchapter V debtor retains the sole power to file a chapter 11 plan.