Recent Developments in Bankruptcy and Restructuring Law: Marijuana and Safe Harbors

(177 Ratings)

Produced on: October 16, 2018

Course Format On Demand Audio

Taught by


Course Description

Time 61 minutes
Difficulty Intermediate

Although more and more states have legalized the medical or recreational use of marijuana, marijuana remains strictly illegal under federal law. As a result, individuals and entities that are involved (however tangentially) in the growing and distribution of marijuana as part of a business are generally barred from seeking relief in the federal bankruptcy court. This program, presented by Michael Riela and Richard Trotter of Tannenbaum Helpern, will discuss the relevant federal law with respect to marijuana, and alternative avenues that individuals and distressed companies in the marijuana business might be able to pursue to restructure their debts or liquidate their assets.

The Bankruptcy Code provides a “safe harbor” against preference and certain fraudulent transfer ”clawback” actions, which have been relied upon by certain types of creditors for many years. However, in its Merit Management Group, LP v. FTI Consulting, Inc. decision earlier this year, the Supreme Court substantially narrowed the scope of the safe harbor. This course will examine the Supreme Court’s decision and its future implications.

Learning Objectives:
  1. Examine the status of federal law with respect to marijuana
  2. Explore debt restructuring and asset liquidation alternatives to bankruptcy for individuals and distressed companies that are involved in the marijuana business
  3. Analyze the Bankruptcy Code’s “safe harbor” from preference and certain fraudulent transfer avoidance actions, and explore the Supreme Court’s decision in Merit Management Group, LP v. FTI Consulting, Inc. that limited that safe harbor


Michael Riela

Tannenbaum Helpern Syracuse & Hirschtritt LLP

Mike Riela is a partner in Tannenbaum Helpern’s Creditors’ Rights and Business Reorganization practice. With more than 15 years of experience, Mike advises companies on complex restructuring, distressed M&A, loan transactions and bankruptcy related litigation matters. Mike has in-depth experience in advising clients on corporate and real estate bankruptcies, workouts, Chapter 11 and Chapter 7 bankruptcy cases, debtor-in-possession (DIP) and bankruptcy exit loan facilities, secondary market trading of distressed debt and trade claims, Section 363 sales and bankruptcy retention and fee agreements and disputes. His clients include banks, administrative agents, indenture trustees, hedge funds, private equity firms, professional services firms, trade creditors, contract counterparties, shareholders, debtors and investors.

Mike has represented buyers of assets in Section 363 and out-of-court sales from sellers such as Evergreen Solar, Inc., Sonic Telecommunications International, Ltd, Urban Communicators PCS Limited Partnership, US Aggregate, Inc., and Vectrix Corporation, as well as representing lenders, trustees and administrative agents in major Chapter 11 cases and workouts such as Delta Air Lines, Inc., Extended Stay Inc., Buffets Inc., Legends Gaming LLC, Nortel Networks, Premier International Holdings Inc., and many others.

Mike also works with clients on cybersecurity and data privacy issues, including the assessment and investigation of information security and data breach incidents. Before any data breaches occur, Mike prepares and helps clients implement written information security programs, systems access policies, and incident response plans. After clients suffer a breach, Mike assists with their response and advises on their legal duties, including clients’ duties under various security breach notification laws.

Prior to joining Tannenbaum Helpern, Mike was a shareholder at Vedder Price and was a counsel at Latham & Watkins. He has been recently selected to serve on the 2016 Bankruptcy editorial advisory board for the Law360 publication.

Richard Trotter

Tannenbaum Helpern Syracuse & Hirschtritt LLP

Richard Trotter is an associate in Tannenbaum Helpern’s Litigation and Bankruptcy practice groups.  His diverse practice includes litigating a wide variety of complex commercial litigation and bankruptcy disputes in state, federal and bankruptcy court. Such disputes have involved issues of contract, securities, real estate and bankruptcy law. He has experience with both commercial and municipal bankruptcy context and has worked to preserve and enforce the rights of different parties at all stages of bankruptcy.


David R.

Interesting overview of how the conflict of federal & state laws can impact financial remedies for parties in a semi-legal industry.

Savery G.

very good, clear and easy to follow presentation

Elizabeth F.


Jennie W.

Very informative and well done.

Louis D.

Useful update on the state of play in Washington with regard to enforcing federal law on marijuana and its impact on bankruptcy filings.

Nikki K.

excellent up to the minute up to date info. well prepared and well presented. Thank you!

William H.

Solid presentation.

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$ 59 Business, Corporate, & Securities Law, Bankruptcy & Restructuring, and Food, Beverage, & Agriculture In Stock


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