Jeffrey Blumenfeld, partner and Co-chair of Lowenstein Sandler’s Antitrust & Trade Regulation practice, and Bruce S. Nathan, partner in the firm’s Bankruptcy, Financial Reorganization & Creditors' Rights Department, have authored “A Business Guide to Antitrust for Credit Professionals.” The publication was prepared at the request of The Credit Research Foundation, an educational and research organization dedicated to the credit, accounts receivable, and financial management community.
The white paper provides guidance on avoiding antitrust violations in communications and shared information among credit professionals, including situations involving involuntary bankruptcy filings and creditors’ committees. It offers a history and overview of state and federal laws and cases governing these issues, in addition to helpful do’s and don’ts for credit professionals participating in credit group and other meetings, creditors’ committees, and involuntary bankruptcy petitions. The paper also gives practical answers to frequently asked questions about topics such as the impact of international laws, strategies in response to requests for extended credit terms and joining involuntary bankruptcy petitions, and what a person should do if present during impermissible communications.
“As we see a rise in bankruptcies in the wake of COVID -19,” says Blumenfeld, “credit professionals need to pay heightened attention to antitrust laws, especially while they work with other creditors on restructurings, because penalties for violations can create permanent and lasting damage to their ability to do business. Because it is not always easy to know what may and may not be discussed in casual or professional situations like industry events, association meetings, and golf outings, we wanted to give the credit community practical tips, such as how to conduct a ‘noisy exit’ when you witness potentially noncompliant discussions and what topics of conversation are ‘OK’ or ‘not OK.’”
“Like all professionals, members of the credit industry need to gather and share information, whether it’s for broad industry analysis or to protect against bad debt risk and fraudulent customers,” says Nathan. “However, they need to be aware of best practices regarding gathering and sharing that information and what they are doing with it in order to avoid antitrust violations.”
The paper notes that in fiscal year 2019, the DOJ Antitrust Division filed criminal cases against 15 corporations and 41 individuals, losing only one of the criminal antitrust cases it brought. Total criminal fines and penalties were nearly $200 million, and at the end of the fiscal year, the DOJ had 91 open grand jury investigations of criminal antitrust activity.
With more than 35 years of government and private practice experience, Blumenfeld is a leading figure in the competition issues that shape today's economy. As outside counsel, in-house general counsel, board director, and litigator, he represents companies and their investors on a broad range of competition issues, including criminal antitrust matters (investigations and trials), class action antitrust lawsuits, actions brought by customers and suppliers, actions by or against competitors, monopolization cases, and transactions. He began his career with more than a decade at the Antitrust Division of the Department of Justice (DOJ) and in the U.S. Attorney's Office for DC as Assistant Chief of the Special Regulated Industries Section of the Antitrust Division.
Nathan has more than 35 years of experience in the bankruptcy and insolvency fields and is a recognized leader nationwide in trade creditor rights and the representation of trade creditors in bankruptcy and other legal matters. He has represented trade and other unsecured creditors, unsecured creditors' committees, secured creditors, and other interested parties in many of the larger Chapter 11 cases that have been filed. Nathan also handles letters of credit, guarantees, security, consignment, bailment, tolling, and other agreements and legal credit issues for the credit departments of institutional clients. He received the Top Hat Award in 2011, a prestigious annual award honoring extraordinary executives and professionals in the credit industry; he also coauthored "Trade Creditor Remedies Manual: Trade Creditors' Rights under the UCC and the U.S Bankruptcy Code," published by ABI.
About Lowenstein Sandler LLP
Lowenstein Sandler is a national law firm with over 350 lawyers based in New York, Palo Alto, New Jersey, Utah, and Washington, D.C. The firm represents leaders in virtually every sector of the global economy, with particular emphasis on investment funds, life sciences, and technology. Recognized for its entrepreneurial spirit and high standard of client service, the firm is committed to the interests of its clients, colleagues, and communities.
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