The 10 Latest Bankruptcy and Restructuring Articles

The Inducement Trap: The First Circuit Subordinates PREPA Bondholders’ $8.5 Billion Claim Against the Commonwealth Under Section 510(b)

Nelson Mullins — Wed, 07 Oct 2026 17:53:15 -0500

Bondholders tend to think of Section 510(b) of the Bankruptcy Code, 11 U.S.C. § 510(b), as someone else’s problem. The provision subordinates claims “for damages arising from the purchase or sale” of a security of the debtor or its affiliate, and the typical claimant is a disappointed shareholder trying to recover as a creditor, not a holder of fixed debt. The First Circuit’s September 23, 2026 decision in the PREPA revenue bond litigation is a reminder that the statute says “security,” not “stock,” and that the words a claimant uses to describe its own claim can decide whether it is paid. The trustee for PREPA’s bondholders filed an $8.5 billion proof of claim in the Commonwealth of Puerto Rico’s Title III case, alleging that the Commonwealth had impaired statutory and constitutional protections it granted as a “material inducement for investors to purchase” the bonds. In re Fin. Oversight & Mgmt. Bd. for P.R., Nos. 25-1745, 25-1748, 25-1749, 25-1750, 25-1751, slip op. at 8 (1st… Read the complete article here... Copyright ©2026 Nelson Mullins Riley & Scarborough LLP

Weekly Bankruptcy Alert October 6, 2026 (For the Week Ending October 4, 2026)

Pierce Atwood LLP — Tue, 06 Oct 2026 14:10:59 -0500

Covering reported business bankruptcy filings in Massachusetts, Maine, New Hampshire, and Rhode Island, and Chapter 11 bankruptcy filings in New York and Delaware listing assets of more than $1 million. Chapter 11 Debtor Name BusinessType1 BankruptcyCourt Assets Liabilities FilingDate Concurrent Holdco, LLC(Hingham, MA) Other Electrical Equipment and Component Manufacturing Boston(MA) $100,001to$500,000 $1,000,001to$10 million 9/28/26 Cotulla Bess LLC(Hingham, MA) Other Electrical Equipment and Component Manufacturing Boston(MA) $100,001to$500,000 $1,000,001to$10 million 9/28/26 Morey Brothers General Contracting, Inc.(Westford, MA) Building Equipment Contractors Worcester(MA) $100,001to$500,000 $1,000,001to$10 million 9/30/26 BRKR LLC(Portland, ME) Residential Building Construction Portland(ME) $1,000,001to$10 million $1,000,001to$10 million 9/29/26 63 Spring Lafayette LLC(New York, NY) Not Disclosed Wilmington(DE) $10,000,001to$50 million $10,000,001to$50 million 9/… Read the complete article here... ©2026 Pierce Atwood LLP. All rights reserved.

Massachusetts AG Bars Debt Collectors and Secures Approximately $52 Million in Consumer Debt Relief

Greenberg Traurig, LLP — Tue, 06 Oct 2026 11:43:20 -0500

On Sept. 14, 2026, Massachusetts Attorney General Andrea Joy Campbell announced a consent judgment permanently barring three affiliated Avon, Massachusetts-based debt collection companies and their owner from collecting debts in or from the Commonwealth. The AG’s office estimates that the settlement will provide more than 6,000 Massachusetts consumers with approximately $52 million in relief from alleged debts. The settlement resolves allegations that Champion Funding, Inc., Champion Funding, LLC, Judgment Acquisitions Unlimited, Inc., and their owner, Andrew Metcalf (collectively, the defendants), used unfair and deceptive debt collection practices, including seizing consumers’ vehicles to coerce payment. The judgment prohibits the defendants from selling or transferring Massachusetts consumer debts, thereby extending its impact to their existing portfolios, and imposes a suspended $650,000 monetary judgment. The defendants deny the allegations beyond the facts specifically… Read the complete article here... ©2026 Greenberg Traurig, LLP. All rights reserved.

Congress Passes Law to Raise Subchapter V and Chapter 13 Debt Limits

Miller Canfield — Thu, 01 Oct 2026 13:57:27 -0500

The debt limit for subchapter V of chapter 11 has had a wild ride. Fortunately, it appears that the days of fluctuating debt limits are behind us, with the Senate’s unanimous passage of H.R. 7730. The bill now heads to the President, who is expected to sign it into law. Subchapter V debuted effective February 19, 2020, and is designed to meet the needs of small businesses for whom a “standard” chapter 11 bankruptcy case is often too expensive and unwieldy. Subchapter V initially carried a debt limit of $2,725,623, meaning that debtors with noncontingent, liquidated debt[1] in excess of this amount were ineligible for relief under this part of the Bankruptcy Code. The subchapter V debt limit was soon raised to $7,500,000 by the CARES Act, but with a sunset provision. The sunset date was extended by a year, but eventually lapsed, dropping the limit back to $2.7 million. An automatic inflation adjustment raised the limit to $3,024,725[2] in 2022. Congress then restored the $7.5… Read the complete article here... © 2026 Miller, Canfield, Paddock and Stone PLC

Earthwise Seed Plants Itself in Chapter 11 in the Garden State

Stark & Stark — Mon, 28 Sep 2026 11:17:02 -0500

Earthwise Seed Company, LLC, an online seller of lawn, clover, wildflower, and other seed products, filed a voluntary Chapter 11 petition on September 25, 2026, in New Jersey. The case is pending in Newark as Case No. 26-20955 (VFP). The Paterson-based company is proceeding under Subchapter V, a streamlined Chapter 11 process available to qualifying small businesses. The petition estimates Earthwise Seed’s assets at between $100,001 and $500,000 and its liabilities at between $1 million and $10 million, with fewer than 50 creditors. Earthwise Seed states that funds are expected to be available for distribution to unsecured creditors. Its largest-creditors list reflects obligations to a mix of financing, shipping, advertising, and seed and garden-industry businesses. Among the latter are Ernst Conservation Seeds, listed with an unsecured claim of approximately $154,247, and Central Garden & Pet, listed at approximately $131,564. The filing follows a period of reported customer-… Read the complete article here... COPYRIGHT © 2026, STARK & STARK

New Jersey Bankruptcy Court Approves HouseCanary's First-Day Motions

The National Law Review — Fri, 25 Sep 2026 19:40:56 -0500

The U.S. Bankruptcy Court for the District of New Jersey approved first-day relief for HouseCanary on September 24, allowing it to draw an initial $3 million in debtor-in-possession (DIP) financing as it pursues reorganization. HouseCanary, a real estate technology and analytics company founded in 2013, and five affiliated companies filed for Chapter 11 bankruptcy protection on September 22. The filings followed a secured creditor’s attempt to foreclose on collateral securing a $30 million loan. HouseCanary entered into the credit facility with Ocean II PLO LLC (Ocean II) in March 2021, granting the lender a security interest in almost all HouseCanary’s assets — including bank accounts, securities accounts, equipment, and investment property. HouseCanary failed to repay the loan at maturity and is in default. HouseCanary filed for bankruptcy to halt a public foreclosure sale by Ocean II of the collateral securing its loan. The auction was scheduled to be held in California on… Read the complete article here... Copyright ©2026 The National Law Review

Next Stop: Chapter 11—Brightline Florida Railroad Files in New Jersey

Stark & Stark — Fri, 25 Sep 2026 09:47:26 -0500

On September 24, 2026, seventeen entities affiliated with Brightline Florida filed voluntary Chapter 11 petitions in the United States Bankruptcy Court for the District of New Jersey. The cases are assigned to the Honorable Mark E. Hall. FIHPNP LLC’s case is Case No. 26-20876 (MEH), which the debtors have asked the Court to designate as the lead case for joint administration. The debtors have proposed Skadden, Arps, Slate, Meagher & Flom LLP and Cole Schotz P.C. as bankruptcy co-counsel. The filings are part of a prearranged restructuring intended to reduce leverage and improve liquidity. Supporting stakeholders have comitted $490 million in new long-term capital, $140 million of additional senior debt and $350 million of new junior debt, while Brightline Trains Florida LLC, the entity that operates the Miami-to-Orlando passenger service, is not a debtor and is expected to continue normal operations. Public reports indicate that the bankruptcy follows concerns over Brightline’s… Read the complete article here... COPYRIGHT © 2026, STARK & STARK

Saudi Arabian Sand Trap: LIV Golf Files Chapter 11

Shumaker — Fri, 25 Sep 2026 09:14:48 -0500

From the June 6, 2022 signing of Phil Michelson to a $200 million multi-year contract with promise for recruitingadditional marquee golfers, to a 2022-2025 estimated cash burn of $4.8 billion, to a Chapter 11 filing in New Jersey on September 8, 2026, LIV is now on the verge of liquidation. Four years ago, LIV Golf promised “Golf, But Louder.” Protracted 72-hole tournaments would be swapped for higher octane 54-hole team events with shotgun starts, blaring music and huge payouts for players. Backed by $5 billion of investment from the Saudi Public Investment Fund (PIF), LIV attempted to disrupt the civilized world of golf and position Saudi Arabia as a global entertainment leader. PIF has now indicated it will cease funding, forcing LIV Golf to seek protection in Chapter 11. LIV’s largest creditors are the very golfers it lured away from the PGA. Jon Rahm, Bryson DeChambeau and Dustin Johnson tee off in Chapter 11 with claims of $7.5 million, $5.7 million and $5.5 million,… Read the complete article here... © Copyright 2026 Shumaker, Loop & Kendrick, LLP. All Rights Reserved.

The Roof Caves In: HouseCanary Files Chapter 11 to Avoid UCC Foreclosure

Stark & Stark — Wed, 23 Sep 2026 16:27:42 -0500

HouseCanary, Inc., a San Francisco-based real estate technology and analytics company, along with several affiliated entities filed voluntary Chapter 11 petition’s on September 22, 2026, in the Bankruptcy Court for the District of New Jersey. The lead case is In re HouseCanary, Inc., Case No. 26-20769, assigned in the Trenton vicinage to Judge Eamonn James O’Hagan. It appears that filing was timed to stave off Ocean II PLO LLC, secured creditor, that intended to conduct a public foreclosure sale in California on the same date as of the filing. The noticed collateral included substantially all of HouseCanary’s assets and property, including accounts, receivables, deposit and securities accounts, equipment, inventory, investment property, general intangibles, certain intellectual-property-related payment rights, and proceeds. The foreclosure notice excluded specified assets, most notably HouseCanary’s claims and proceeds from long-running Texas litigation involving Amrock Inc., and… Read the complete article here... COPYRIGHT © 2026, STARK & STARK

The Dangers of Vague Language in Easements

Stark & Stark — Wed, 23 Sep 2026 12:22:37 -0500

Vague language in easements is one of the most common sources of property disputes. When the wording is unclear, owners, neighbors, and even tenants can find themselves fighting over basic questions and creating enforcement issues over time. What is an easement? An easement is a legal right to use someone else’s land for a specific, limited purpose, such as access, parking, or utilities, without owning that land. The land burdened by the easement is called the “servient estate,” and the land or party that benefits is the “dominant estate.” How can ambiguous language impact property? The language and interpretation of easements are governed under contract law. Therefore, courts look heavily at both what was said and what was not said in interpreting the scope of the easement and establishing what is and is not a violation of the easement. Depending on the type of easement, the language of an easement is binding on all future owners of both the dominant and servient estate. Therefore,… Read the complete article here... COPYRIGHT © 2026, STARK & STARK