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Rule 2019
Practical Law Glossary Item 9-501-2833 (Approx. 3 pages)
Glossary
Rule 2019
A Federal Rule of Bankruptcy Procedure which requires official and unofficial committees and informal groups consisting of or representing multiple creditors or equity security holders disclose the identity of each member and its "disclosable economic interests" in a debtor in a Chapter 9 or Chapter 11 bankruptcy case (as well as the identities of, and the disclosable economic interests held by, each entity represented by the committee or group). A failure to comply with Rule 2019 may result in an inability of the committee or entity to participate in the bankruptcy proceedings.
Information that must be disclosed under Rule 2019 includes:
- The circumstances surrounding the formation of a group or committee and the name of each entity at whose insistence the group or committee was formed or for whom the group or committee has agreed to act.
- The names and addresses of each member of the group or committee and those entities represented by the group or committee.
- The nature and amount of each member's disclosable economic interest in the debtor on the date the group or committee was formed, as well as the nature and amount of disclosable economic interests held by each entity represented by the group or committee as of the date the verified Rule 2019 statement was filed. A disclosable economic interest is defined broadly to cover any economic interest that could affect the legal and strategic positions a stakeholder takes in a Chapter 9 or Chapter 11 case (including claims, interests, pledges, liens, options, participations, and derivative instruments).
- For any group or committee that claims to represent any entity in addition to members of the group or committee, the quarter, and year in which each member of the group or committee acquired its disclosable economic interest, unless the acquisition was more than one year before the bankruptcy petition was filed. Disclosure of the price paid for a disclosable economic interest is not required, unless ordered by the court.
This reflects the amended version of Rule 2019, which became effective on December 1, 2011.
For more information, see Practice Note, Disclosure Under Bankruptcy Rule 2019.