Zoom is emerging as the new standard for use in bankruptcy filings. Zoom bankruptcy meeting of creditors will now be standard for all Chapter 7 and Chapter 13 cases. Almost all bankruptcy meeting of creditors in the past were held in-person. Previously, these bankruptcy meetings were held in federal court houses or federal buildings.
As the greater metaverse emerges, new technologies such as Zoom meetings have taken a lead within the realm of bankruptcy. Nothing as of yet has been fully standardized for virtual meetings or virtual document transfer in bankruptcy. This has been a problem for bankruptcy filings which now are now stuck halfway between digital documents and the paper mailings of the past. For instance, the bankruptcy court does not take debtor’s emails or phone numbers for text messaging. As an irony, the U.S. Courts still only mail a physical copy of the 341 bankruptcy notice with the information on how to “virtually” attend the meeting through a Zoom codes. No links, no texts – just a mailed piece of paper.
Another irony exists within our new Zoom days of virtual bankruptcy. All documents are required to be digitally transferred within the bankruptcy court. Yet, current bankruptcy law only accepts wet signatures on physical documents for all major signature parts of the bankruptcy petition. This, ironically, can require U.S. mail again and longer wait times for virtual bankruptcy filers.
Zoom bankruptcy meetings of creditors will move the court in the right direction. It will also pave the way towards new, more modern bankruptcy legislation. The last bankruptcy major Bankruptcy Act of 2005 (BAPCPA) was written at a time when many bankruptcy cases were still paper filed or uploaded by a dropped-off floppy disk. Although the internet and other advance technologies did exist at the time, the 2005 Bankruptcy Act is now very dated and behind the times.
New bankruptcy legislation could accommodate a fully virtual form of bankruptcy. The code could establish new software and collection methods. All relevant personal data could be collected using virtual-style programs. Petition questions, assets, and documents could all be in digital, virtual format. Also, signatures for the case could all occur in modern, virtual format as well. Zoom bankruptcy meetings are a powerful step in modernizing bankruptcy even without a major code change. It will be a large precedent that will help move bankruptcy towards modernity.
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