Reuters reports that a district court judge has deferred to the bankruptcy court on whether Johnson & Johnson is entitled to the continuing protection of the Bankruptcy Code's automatic stay from mass tort lawsuits that it would otherwise face relating to its talc products while its subsidiary, LTL Management, proceeds through bankruptcy.  A committee of talc claimants appointed in LTL Management's case had moved to "withdraw the reference" of that decision from the bankruptcy court, arguing that the matter would be more appropriately decided by the district court.  The district court disagreed, finding that the reach of the automatic stay was a matter within the core jurisdiction of a bankruptcy court.  [Reuters; Jan. 12, 2022].

The Financial Times reports that the Houston Division of the Southern District of Texas has become a magnet for mega chapter 11 bankruptcy cases, challenging more traditional jurisdictions like Delaware and the Southern District of New York.  In 2021, a third of all U.S. bankruptcy filings where the debtor's liabilities exceeded $500 million were filed in Houston.  Major cases filed in Houston include JC Penney, Neiman Marcus, and Chesapeake Energy.  [Financial Times ; Jan. 11, 2022]

Reporting from the Wall Street Journal indicates that the Federal Reserve has concerns about rising inflation in the U.S.  Federal Reserve Chair Jerome Powell called high inflation a "severe threat" to full economic recovery and said that the central bank plans to raise interest rates because the economy no longer needs emergency support.  However, Powell also stated he is optimistic that supply-chain bottlenecks will ease, helping to lower inflation.  [WSJ; Jan. 11, 2022]

Visit us at mayerbrown.com

Mayer Brown is a global legal services provider comprising legal practices that are separate entities (the "Mayer Brown Practices"). The Mayer Brown Practices are: Mayer Brown LLP and Mayer Brown Europe - Brussels LLP, both limited liability partnerships established in Illinois USA; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales (authorized and regulated by the Solicitors Regulation Authority and registered in England and Wales number OC 303359); Mayer Brown, a SELAS established in France; Mayer Brown JSM, a Hong Kong partnership and its associated entities in Asia; and Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. "Mayer Brown" and the Mayer Brown logo are the trademarks of the Mayer Brown Practices in their respective jurisdictions.

© Copyright 2020. The Mayer Brown Practices. All rights reserved.

This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.