Consumer Protection and Corporate Accountability in Bankruptcy Act of 2026

This bill changes federal bankruptcy law for Chapter 11 business cases. It would let courts dismiss a case if the filing is objectively futile or made in subjective bad faith, and it would require courts to presume bad faith in certain situations, such as when a debtor manufactured the venue, recently went through a divisional merger, or filed mainly to gain a litigation advantage, delay creditors, or cap liability for mass injury claims it can afford to pay. The debtor would carry the burden of proof in these determinations. The bill would also stop the automatic bankruptcy pause from blocking lawsuits against non-bankrupt parties over certain injury claims affecting 100 or more people if the debtor went through a corporate restructuring in the prior four years, and courts could not issue orders overriding this rule. It would set a 24-month deadline tied to one ground for dismissal and apply to cases filed or pending on or after enactment.

Full text and official record on Congress.gov

Sponsors

• Emilia Strong Sykes Democrat sponsor
• 3 cosponsors