Congressman Jerrold Nadler (NY-08), Chairman of the House Judiciary Subcommittee on the Constitution, Civil Rights and Civil Liberties, today introduced the Business Reorganization and Job Preservation Act of 2009, which would amend federal Bankruptcy Code to repeal provisions of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA). As BAPCPA currently stands, many businesses nationwide have been unable to reorganize successfully in bankruptcy and have been pushed into liquidation, at the cost of thousands of jobs. Circuit City, for example, was unable to secure financing to complete its reorganization last year and was forced to liquidate, sacrificing 34,000 jobs across the country.

“In an economy as depressed as ours, we must be cognizant of the many difficulties facing American businesses and avoid placing unnecessary hurdles in their paths,” said Rep. Nadler. “The Business Reorganization and Job Preservation Act of 2009 will remove some of obstacles now hindering struggling businesses and inject a much-needed economic boost during this time of severe recession. It’s essential that we give retailers, which are often the job-providers of our communities, the means to reorganize and stay in business.”

The present law gives landlords and lenders the ability to make tougher demands on businesses filing for bankruptcy and, in many cases, locks tenants into new leases while they face reorganization procedures. In 2008, two dozen major national retailers sought bankruptcy. If passed, the Business Reorganization and Job Preservation Act would stem that tide and offer crucial assistance to retailers suffering major losses in the current economic recession.