Monthly Archives: October 2019

Movement in Congress on Bankruptcy Issues

We have an update from Congress on a couple of bankruptcy-related issues on which the BBA has a formal position.

First, two members of Congress have introduced a bipartisan bankruptcy-venue reform bill. While H.R. 4421 is new to the current 116th session of Congress, it’s substantially similar to legislation that the BBA has previously endorsed.

The proposed law eliminates the place of incorporation in favor of filing where the debtor’s principal place of business or principal assets are located, thus making it more likely that local bankruptcy cases will be decided at home.

Current law provides a loophole that allows troubled companies to flee their home states and seek bankruptcy protection in remote jurisdictions, disenfranchising creditors, employees, pensioners, and other interested local parties.

Bertucci’s, Filene’s, City Sports, Friendly’s, and the Boston Herald are just a few examples of Massachusetts-based firms that have filed in Bankruptcy Court elsewhere since 2009. H.R. 4421 would put a stop to this forum-shopping — a practice that results in the vast majority of major bankruptcies being filed in either Delaware or the Southern District of New York, creating a hardship for local stakeholders.

This is one of those instances when you may be able to help advance the issue: The sponsors of H.R. 4421 (Representatives Zoe Lofgren of California and Jim Sensenbrenner of Wisconsin) are interested in gathering additional support, so if you have a moment to contact your own Representative in Congress, please give them a call or send an e-mail, urging them to sign on.

The second issue has to do with the treatment of Veterans’ Administration benefits to individuals in bankruptcy. You may recall that, this past June, the BBA endorsed legislation to protect those veterans by closing a loophole that excludes Social Security disability benefits, but not veterans’ disability benefits, from the calculation of disposable income when a debtor files for bankruptcy. 

The HAVEN Act was introduced in Congress to rectify this imbalance by excluding veterans’ disability benefits from that calculation of income, and then-President Jon Albano sent a letter to the Massachusetts Congressional delegation, expressing the BBA’s support of it.

Since then, the measure passed both the House and Senate by voice vote and was signed into law.

We thank our own Bankruptcy Section for their work in identifying, researching, and presenting these issues to the BBA Council for their consideration and ultimate endorsement.

—Michael Avitzur
Government Relations Director
Boston Bar Association

BBA Files Amicus Brief In Support of Just Compensation for Appointed Criminal-Defense Counsel

Citing an on-going crisis in the Commonwealth’s criminal courts, the BBA last week filed an amicus brief urging the SJC to take decisive action to address a shortage of attorneys available to represent indigent criminal defendants, as is constitutionally required.

Submitted in the case of Freddie Carrasquillo v. Hampden County District Courts (SJC-12777), the BBA’s brief traces the long history of underfunding of such defense work—now provided through the Committee for Public Counsel Services (CPCS), often by appointing private bar advocates.

That history includes the so-called Lavallee protocol, instituted by the Supreme Judicial Court (SJC) as part of a 2004 case by that name and once again in effect today. Lavallee requires the Commonwealth to release from pretrial detention all indigent defendants who do not receive a lawyer within seven days, and the courts to dismiss without prejudice the cases of those indigent defendants who do not receive a lawyer within 45 days.

The brief, drafted by two attorneys from Foley Hoag LLP, Amicus Committee Co-Chair Neil Austin and Stephen Stich, and by former Amicus Committee Co-Chair Professor David Siegel of New England Law | Boston, argues that, 15 years later, a shortage of lawyers for indigent criminal defendants, in Hampden County and elsewhere, continues to be a significant problem, and that the emergency Lavallee protocol cannot offer a permanent cure to “the chronic problem of an underfunded criminal justice system.”

Although hourly rates for bar advocates have risen since Lavallee, the BBA brief demonstrates that the increases haven’t kept up with inflation, nor have they amounted to nearly enough for many lawyers to afford to work as bar advocates.

The Carrasquillo case arises from a situation in which the defendant appeared without counsel. The lower court addressed the shortage there by ordering CPCS to provide counsel willing to accept appointment in criminal matters—an order which CPCS then sought to vacate.

The Court there is squarely focused on the Lavallee questions, with the Single Justice having filed an interim order that imposed detailed protocols in Hampden County, in keeping with that earlier ruling. Single Justice Budd then reserved and reported the matter to the full court and asked the parties to submit briefs on possible long-term solutions to the crisis, while keeping in place her earlier order.

The SJC posed the following question in soliciting amicus briefs:

To address the shortage of counsel available in Hampden County to represent indigent criminal defendants, whether the protocol set forth in Lavallee v. Justices in the Hampden Superior Court, 442 Mass. 118 (2004), would provide an appropriate remedy; if not, what other or additional remedies are available.

The BBA uses the opportunity to strongly urge the Legislature, in its brief, to “act promptly and raise bar advocates’ hourly rates to a competitive level” but goes on to recommend that the SJC consider “mandat[ing] the expenditure of funds at a rate sufficient to incentivize enough lawyers to become bar advocates.” This step represents a continuation of the BBA’s advocacy on the right to counsel for indigent defendants.

“For decades, we have supported appropriate compensation for CPCS attorneys and bar advocates in order to ensure due process and the fair and efficient administration of justice,” said BBA President Christine M. Netski of Sugarman Rogers, “and an effective response to this persistent crisis in our justice system is long overdue.”

The brief cites the detrimental effect of insufficient pay on lawyers’ capacities and well-being. It also makes the argument that systematic underfunding for indigent defense threatens public safety—especially in those instances in which prosecutors seek to have a defendant held specifically on the grounds of dangerousness.

“The BBA argued in our 2004 amicus brief in Lavallee that the justice system cannot work fairly unless defense counsel are paid fairly,” Neil Austin said. “Unfortunately, little has changed, and therefore we must again call upon the Court to act in the interest of justice.”

That 2004 brief addressed the evolution of indigent legal defense programs in Massachusetts and the chronic lack of funding suffered at each stage of their development. Noting at that time that sufficient funds “are not being provided today,” the BBA urged the SJC “to insist upon what may be a harsh reality: that the systems will not work fairly—especially for the defendants—unless defense counsel are paid adequate compensation.”

The earlier brief was drafted by three attorneys then at Choate, Hall & Stewart (today, Choate), Jack Cinquegrana, Michelle Dineen Jerrett, and Terrence Schwab.

On July 28, 2004, the SJC found that the defendants in these cases were being deprived of their right to counsel under the Massachusetts Declaration of Rights and urged all three branches of government to work together to fashion a remedy. Days later, the Legislature passed a bill to increase hourly rates for certain types of cases through a $16.3 million supplement to the Fiscal Year 2005 budget and create a commission to study indigent criminal defendant representation. The final report recommended further increases over a multi-year period. (For a more comprehensive history of CPCS and bar advocate compensation, see here).

However, those recommended increases were never fully implemented, and the problem of chronic underfunding has only worsened. The BBA’s new brief updates the data to highlight the economic challenges facing bar advocates.

The Carrasquillo case, as well as two related consolidated cases from Worcester County, will be argued before the SJC on November 7, with a ruling expected by March. We encourage you to join us by watching that live from the Brooke Courthouse, starting at 9am.

—Michael Avitzur
Government Relations Director
Boston Bar Association