On May 16, the Supreme Court of the United States ruled on Husky Int'l Elecs., Inc. v. Ritz, a bankruptcy case that questions whether fraudulent transfers qualify as an exemption to the discharge of debts owed to a creditor. The High Court ruled that Ritz had committed sufficient actual fraud.

The ruling, Professor Charles Tabb tells Bloomberg, "further eviscerates the [Bankruptcy Code's] fresh start policy." He goes on to say, "It undermines the fresh start policy, greatly expanding the fraud exception far beyond its historical origins, to the detriment of individual debtors. There is no basis for thinking that Congress intended such a dramatic exception to the fraud exception when it added the words ‘actual fraud.'”

PDF of the full Bloomberg article