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The Senate Judiciary Committee held a hearing yesterday titled "Evading Accountability: Corporate Manipulation of Chapter 11 Bankruptcy." Witnesses included Prof. Melissa B. Jacoby of UNC School of Law (Chapel Hill, N.C.), Lori Knapp (Greeneville, Tenn.), Prof. Samir D. Parikh of Lewis & Clark Law School (Portland, Ore.), Stephen Hessler of Sidley Austin LLP (New York) and Erik Haas of Johnson & Johnson (Armonk, N.Y.). Numerous members of the committee pressed Haas on J&J's use of the "Texas Two-Step" strategy when it funneled approximately 40,000 lawsuits into its newly created subsidiary, LTL Management LLC, and filed for bankruptcy. To view a replay of the hearing and to read prepared witness statements, please click here.

A bipartisan coalition of senators behind a cannabis banking bill is pushing for a markup and working to clear key hurdles on both sides of the aisle to lock down support, The Hill reported. As advocates work to drum up momentum for the Secure and Fair Enforcement (SAFE) Banking Act, some proponents in the upper chamber have expressed hopes the bill could advance out of committee in the coming weeks. “We hope to be able to announce something in the next few days,” Senate Banking Committee Chairman Sherrod Brown (D-Ohio) told reporters this week. The SAFE Banking Act would give federally regulated banks and credit unions legal cover to take cannabis dispensaries and growers as customers. Financial institutions have been hesitant to serve state-legal cannabis businesses because of the federal ban on the drug. Democrats say excitement has been building after the Department of Health and Human Services (HHS) recommended that marijuana, which is classified as a Schedule I drug, be moved to the Schedule III category.

The Senate Judiciary Committee has scheduled a hearing for Tuesday at 10 a.m. ET titled, "Evading Accountability: Corporate Manipulation of Chapter 11 Bankruptcy." Details about the hearing are forthcoming.

Sen. Josh Hawley (R-Mo.) introduced a bill yesterday that would cap the interest rate for credit cards at a “common sense level” of 18 percent in an effort to protect vulnerable borrowers, The Hill reported. “Americans are being crushed under the weight of record credit card debt — and the biggest banks are just getting richer,” Hawley said. “Capping the maximum credit card interest rate is fair, common-sense, and gives the working class a chance,” he added. American credit card debt passed $1 trillion this summer, contributing to quickly rising consumer debt, which grew by nearly $18 billion from May to June, according the most recent federal data available. The average U.S. household carries about $10,000 in credit card debt, according to another analysis. Credit card debt fell significantly in 2020 after the government sent out stimulus checks, but the figure has continued to rise since then, now surpassing its previous pre-pandemic high. Interest rates on credit card debt have also increased in recent months. The average rate was about 21 percent as of June. It was about 17 percent last spring. Hawley’s legislation would also prevent credit card companies from implementing fees to get around the 18-percent cap and issue penalties to enforce the limits.

The International Brotherhood of Teamsters on Tuesday called for changes to U.S. bankruptcy laws following the chapter 11 filing of freight trucking company Yellow Corp (YELL.O), saying that workers must not be "left behind" when big businesses fail, Reuters reported. The Teamsters union said that 22,000 of its members were out of work despite making significant concessions on wages and pension benefits in labor negotiations with the nearly 100-year-old company, which filed for bankruptcy on Sunday. Yellow has blamed the Teamsters' opposition to its internal reorganization efforts for its collapse. But the Teamsters said its members had sacrificed more than $5 billion in wage and benefit concessions since 2009 to keep Yellow moving. The union warned that the bankruptcy could mean they will not receive bargained-for retirement benefits or severance pay. The union argued that U.S. bankruptcy law should be reformed to protect collecting bargaining agreements and worker retirement plans, which can be terminated by a bankrupt company or by a new buyer who acquires a company out of bankruptcy.