Leah M. Eisenberg Authors Article in American Bankruptcy Institute Journal, “U.S. Continues to Wait for the Federal Legalization of Cannabis”
Leah M. Eisenberg, partner in the firm’s Bankruptcy, Restructuring & Creditors’ Rights practice, authored an article in the American Bankruptcy Institute Journal titled, “U.S. Continues to Wait for the Federal Legalization of Cannabis.” The article discusses recent cases that signify a shift in the reluctancy of bankruptcy courts to allow debtors in the cannabis business to access traditional bankruptcy relief.
“The tension between (x) the CSA’s enforcement of marijuana and (y) state laws that legalize or decriminalize marijuana has continued to evolve in the context of bankruptcy courts that have been faced with distressed debtors seeking relief under chapters 7, 11 and 13. Procedurally, the dispute as to whether the CSA prohibits a debtor’s access to a particular Bankruptcy Code provision has come up in various contexts, including general estate administration and plan confirmation, resulting in the dismissal of many cases.
However, recent cases signify a slight shift — providing a very limited path for businesses to seek relief under the Code. These cases involve specific sets of facts where the debtor (1) had remote connections with a cannabis business or (2) formerly operated or received income in connection with a cannabis business,” writes Eisenberg.
To read Eisenberg’s full article in the ABI Journal, click here.
