In Law360 Article, Schultz, Biblo Block Highlight the Benefits of Virtual Hearings in Texas Bankruptcy Courts

Law360 has published the article, “Texas Bankruptcy Courts' Virtual Hearings Benefit All Parties,” written by Akin Gump financial restructuring partner Sarah Schultz and counsel Rachel Biblo Block. The article discusses the impact of the COVID-19 pandemic on bankruptcy courts in Texas, how they adapted to new restrictions and the benefits of those changes.

The authors begin by discussing the immediate closures of the courts at all levels of the judicial system at the onset of the pandemic in March 2020. However, while various federal and state court hearings were rescheduled, postponing hearings or stopping activity was not an option for bankruptcy courts, as “bankruptcy cases regularly involve a debtor that is a melting ice cube, and employees' livelihoods and local economies' existence depend upon the survival and timely reorganization of a company.”

Recognizing the impact of these issues, bankruptcy courts implemented significant changes to continue their proceedings and quickly shifted to virtual hearings, and the authors explain how the bankruptcy courts’ new procedures “increase efficiencies, reduce costs, expand opportunities, and ultimately, benefit all parties involved in bankruptcy cases.”

Lastly, the article shares the opinions of several esteemed bankruptcy court judges in Texas regarding the benefits of virtual hearings, with Judge Marvin Isgur offering to share the court’s technology with any district across the country and concluding that the new procedures are “advancing the industry and practice into new territory where greater participation and access can trump formalities and previously excluded parties are welcomed with the click of a button.”