S. 2497: Nondebtor Release Prohibition Act of 2021

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S. 2497: Nondebtor Release Prohibition Act of 2021

117th Congress · introduced 2021-07-28 · Finance and Financial Sector · Latest: Read twice and referred to the Committee on the Judiciary.

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Official title

Nondebtor Release Prohibition Act of 2021

Plain summary

Nondebtor Release Prohibition Act of 2021 This bill addresses the release by bankruptcy courts of creditor or other third-party claims against non-debtors. Complex bankruptcies may involve third-party claims against non-debtors associated with the debtor, such as the debtor's officers, directors, or employees. Currently, in carrying out a bankruptcy plan, bankruptcy courts may release non-debtors from liability (there is a split in the judicial circuits regarding this practice). The bill generally prohibits a bankruptcy court from (1) releasing or modifying a non-debtor's liability through the approval of a bankruptcy plan or through an order, or (2) enjoining a judicial proceeding or other act to collect or otherwise enforce such a claim or cause of action against a non-debtor. However, the bill provides for the release of such liability if express consent is given by the third party. The bill also generally limits an order or decree to temporarily enjoin a proceeding against a non-debtor to 90 days. Additionally, the bill gives appellate jurisdiction to the appropriate U.S. court of appeals regarding an order or decree to temporarily enjoin or stay a proceeding against a non-debtor in a Chapter 11 reorganization bankruptcy case. Currently, U.S. district courts have appellate jurisdiction for these matters. Upon request of an interested party, and after notice and a hearing, the court shall dismiss a Chapter 11 reorganization bankruptcy case if the debtor was involved in certain restructuring activity that (1) had the intent or foreseeable effect of separating a debtor's assets from a debtor's liabilities and the debtor assuming or retaining such liabilities, and (2) occurred in the 10-year period prior to the filing of the bankruptcy petition.

Congressional Research Service summary (Introduced in Senate), quoted unchanged (nonpartisan). Read the source.

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Officials and money

Sponsor: Sen. Warren, Elizabeth [D-MA] · 4 cosponsors

Cost estimate: No cost estimate published yet.

Cosponsors on this site

Richard J. Durbin (D-IL), Richard Blumenthal (D-CT), Cory A. Booker (D-NJ), Bernard Sanders (I-VT)

Sponsor's campaign money: Sen. Warren, Elizabeth [D-MA] reported raising $5.0 million (2025–2026). Details. Shown for context only; it does not mean any donor supported this bill.

No linked floor roll calls in our collected records yet. This does not mean the bill has never had a vote. Check the official bill history.

Sources

• Congressional Research Service summary (Introduced in Senate)
• Congress.gov
• Data: GovInfo BILLSTATUS bulk data (Library of Congress), BILLSTATUS-117s2497.xml <https://www.govinfo.gov/bulkdata/BILLSTATUS/117/s>

Record fed-us-cong117-s2497 · catalog fed-us-congress-bills-cong117 · updated 2026-11-15 by psicol fed-bills-cong117