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108th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                    108-110

======================================================================



 
             INVOLUNTARY BANKRUPTCY IMPROVEMENT ACT OF 2003

                                _______
                                

  May 19, 2003.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

 Mr. Sensenbrenner, from the Committee on the Judiciary, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 1529]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on the Judiciary, to whom was referred the bill 
(H.R. 1529) to amend title 11 of the United States Code with 
respect to the dismissal of certain involuntary cases, having 
considered the same, reports favorably thereon without 
amendment and recommends that the bill do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     1
Background and Need for the Legislation..........................     2
Hearings.........................................................     5
Committee Consideration..........................................     5
Vote of the Committee............................................     5
Committee Oversight Findings.....................................     5
Performance Goals and Objectives.................................     5
New Budget Authority and Tax Expenditures........................     5
Congressional Budget Office Cost Estimate........................     5
Constitutional Authority Statement...............................     7
Section-by-Section Analysis and Discussion.......................     7
Changes in Existing Law Made by the Bill, as Reported............     7
Markup Transcript................................................     8

                          Purpose and Summary

    H.R. 1529, the ``Involuntary Bankruptcy Improvement Act of 
2003,'' is intended to provide relief to victims of fraudulent 
involuntary bankruptcy filings in two respects. First, it 
amends the Bankruptcy Code to require the bankruptcy court on 
motion of the debtor to expunge all records relating to a 
fraudulent involuntary bankruptcy case from the court's files 
where the debtor is an individual. Second, it authorizes the 
bankruptcy court to prohibit all credit reporting agencies from 
issuing a consumer report containing any reference to a 
fraudulent involuntary bankruptcy case where the debtor is an 
individual and the court dismissed the case.

                Background and Need for the Legislation

    On April 1, 2003, Chairman Sensenbrenner, introduced H.R. 
1529, the ``Involuntary Bankruptcy Improvement Act of 2003,'' 
to provide relief to victims of fraudulent involuntary 
bankruptcy petitions.
    Current law provides that a person can voluntarily commence 
a bankruptcy case \1\ or be involuntarily forced into 
bankruptcy, under certain circumstances.\2\ With respect to 
involuntary bankruptcy, one or more creditors (meeting 
specified criteria) \3\ can file an involuntary petition for 
bankruptcy relief under chapter 7 (liquidation) or chapter 11 
(business reorganization) of the Bankruptcy Code against an 
individual as well as certain types of business entities,\4\ if 
grounds for granting such relief are established.\5\ If the 
person who is the subject of an involuntary bankruptcy petition 
does not timely oppose the petition, the court enters an 
``order for relief,'' which formally commences the bankruptcy 
case.\6\ If the involuntary petition is opposed by the putative 
debtor, then the court must conduct a trial to determine if the 
debtor should be adjudicated a bankrupt.\7\ Should the court 
dismiss an involuntary petition (other than on consent of the 
debtor), the court may impose various sanctions against the 
party who filed the involuntary bankruptcy petition, such as 
costs, reasonable attorneys' fees, and punitive damages, if 
appropriate under the circumstances.\8\
---------------------------------------------------------------------------
    \1\ 11 U.S.C. Sec. 301 (2000).
    \2\ 11 U.S.C. Sec. 303 (2000).
    \3\ 11 U.S.C. Sec. 303(b) (2000). If, for example, the alleged 
debtor has less than 12 creditors, a single creditor holding a claim of 
at least $11,625 can commence an involuntary petition. 11 U.S.C. 
Sec. 303(b)(2) (2000).
    \4\ 11 U.S.C. Sec. 303(a) (2000). Certain individuals and entities, 
such as farmers and eleemosynary institutions, cannot be involuntarily 
forced into bankruptcy. Id.
    \5\ A court may grant an involuntary bankruptcy petition only if:

      (1) the debtor is generally not paying such debtor's debts 
      as such debts become due unless such debts are the subject 
---------------------------------------------------------------------------
      of a bona fide dispute; or

      (2) within 120 days before the date of the filing of the 
      petition, a custodian, other than a trustee, receiver, or 
      agent appointed or authorized to take charge of less than 
      substantially all of the property of the debtor for the 
      purpose of enforcing a lien against such property, was 
      appointed or took possession.

 11 U.S.C. Sec. 303(h) (2000).
---------------------------------------------------------------------------
    \6\ Id.
    \7\ Id.
    \8\ 11 U.S.C. Sec. 303(i) (2000).
---------------------------------------------------------------------------
    Although fewer than 1 percent of all bankruptcy case 
filings are commenced involuntarily,\9\ an involuntary 
bankruptcy petition can serve as a useful creditor collection 
tool. For example, it can preserve assets from further 
dissipation and provide for their orderly liquidation by a 
bankruptcy trustee, a fiduciary charged by statute to protect 
such assets and maximize their value for the benefit of 
creditors.
---------------------------------------------------------------------------
    \9\ 2 Collier on Bankruptcy para. 303.01 (Alan N. Resnick & Henry 
J. Sommer eds., 15th ed. rev. 2002). According to the Administrative 
Office of the U.S. Courts, only 661 involuntary chapter 7 cases and 110 
involuntary chapter 11 cases were commenced out of more than 1.5 
million bankruptcy case filings for fiscal year 2002.
---------------------------------------------------------------------------
    As with most documents filed in connection with a 
bankruptcy case, the filing of an involuntary bankruptcy 
petition is a matter of public record and is open for 
examination by any entity.\10\ In addition, the Fair Credit 
Reporting Act \11\ permits credit reporting agencies to note 
the involuntary bankruptcy filing on a person's credit report 
for up to 10 years.\12\ Although the Fair Credit Reporting Act 
permits a consumer to have his or her credit report revised to 
reflect the fact, for instance, that the involuntary bankruptcy 
case was dismissed prior to the entry of an order for relief, 
the report may, nevertheless, still refer to the filing of the 
case.\13\
---------------------------------------------------------------------------
    \10\ 11 U.S.C. Sec. 107 (2000).
    \11\ 15 U.S.C. Sec. 1681 (2000).
    \12\ 15 U.S.C. Sec. 1681c(a)(1) (2000).
    \13\ See, e.g., 15 U.S.C. Sec. 1681i (2000); Letter from Ronald G. 
Isaac, Attorney, Federal Trade Commission--Division of Financial 
Practices/Bureau of Consumer Protection, to Anonymous (Nov. 5, 1999), 
available at http://www.ftc.gov/os/statutues/frca/anon.htm.
---------------------------------------------------------------------------
    Unfortunately, tax protesters and other extremists, in 
addition to other forms of obstreperous litigation (such as 
filing false liens), are now resorting to filing fraudulent 
involuntary bankruptcy petitions against public officials and 
other innocent parties. Last year, for example, one tax 
protester filed fraudulent involuntary bankruptcy petitions 
against 36 local public officials in Wisconsin,\14\ some of 
whom did not find out about the petitions until ``they 
attempted to use a credit card or execute some other financial 
transaction.'' \15\ These filings were subsequently dismissed 
by the bankruptcy court, which found that they were filed in 
bad faith without legal basis and were commenced ``for the sole 
purpose of harassment of the named public officials.'' \16\
---------------------------------------------------------------------------
    \14\ See In re Kenealy et al., No. 02-26100-MDM (Bankr. E.D. Wis. 
May 21, 2002). Involuntary petitions ``were filed against all but one 
of the County Board supervisors,'' the county corporation counsel, 
county sheriff, clerk of courts, and county circuit judge. Jeff Cole, 
Paperwork Used for Revenge; Protester's Bogus Bankruptcy Petitions 
Temporarily Disrupt Officials' Credit, Milwaukee J. Sentinel, June 6, 
2002, at 1B. The protester also filed numerous liens in the amount of 
$15 million against these individuals as well. Jeff Cole, Man Charged 
with Filing False Documents; Town of Fredonia Protester's Case is 5th 
Brought by State, Milwaukee J. Sentinel, May 21, 2002, at 1B.
    \15\ Jeff Cole, Paperwork Used for Revenge; Protester's Bogus 
Bankruptcy Petitions Temporarily Disrupt Officials' Credit, Milwaukee 
J. Sentinel, June 6, 2002, at 1B.
    \16\ In re Kenealy et al., No. 02-26100-MDM (Bankr. E.D. Wis. May 
21, 2002).
---------------------------------------------------------------------------
    ``Despite the fact that the [fraudulent involuntary 
bankruptcy] petitions are often dismissed,'' as one State 
assistant attorney general observed, ``the filings continue to 
cause financial problems for the victims.'' \17\ The 
devastating effect of a fraudulent involuntary bankruptcy 
filing on an innocent person's credit rating is illustrated by 
what occurred in Wisconsin and its aftermath. Although the 
bankruptcy court in dismissing these cases also directed all 
credit reporting agencies to expunge any record of these 
filings from the officials' credit reports,\18\ the bankruptcy 
petition filings nevertheless ``caused some officials' credit 
cards to be canceled, almost caused the sale of one 
supervisor's house to be stopped, and caused continuing credit 
problems for other officials.'' \19\ As the Chairman of the 
Ozaukee County Board explained, ``This has resulted in 
notations of bankruptcy in our personal credit history with all 
credit agencies, causing the disruption of the use of our 
credit cards and other financial dealings, not to mention 
increased cost in mortgage interest.'' \20\
---------------------------------------------------------------------------
    \17\ Roy Korte, Terrorism: A Law Enforcement Perspective, Anti-
Defamation League (2002), at http://www.adl.org/learn/columns/
roy5%5korte.asp.
    \18\ In re Kenealy et al., No. 02-26100-MDM (Bankr. E.D. Wis. May 
21, 2002).
    \19\ Jeff Cole,``Paper Terrorist'' Gets Five Years in Prison, 
Milwaukee J. Sentinel, Jan. 18, 2003, at 1B.
    \20\ Letter from Gustav W. Wirth, Jr., Chairman, Ozaukee County 
Board, to F. James Sensenbrenner, Jr., Chairman, Committee on the 
Judiciary (July 25, 2002) (on file with the Subcommittee on Commercial 
and Administrative Law).
---------------------------------------------------------------------------
    While abusive involuntary bankruptcy filings are not 
pervasive, they have been filed in various districts across the 
nation, according to an informal survey conducted by the 
Administrative Office of the United States Courts and the 
National Conference of Bankruptcy Clerks.\21\ In the Southern 
District of Ohio, for example, one person filed fraudulent 
involuntary bankruptcy petitions last year against a Federal 
district court judge, an Internal Revenue Service agent, and 
two attorneys in private practice.\22\ He also attempted to 
file an involuntary petition against a bankruptcy judge.\23\ 
Another individual in that same district filed fraudulent 
involuntary petitions against a tow truck operator and a 
private individual.\24\ In Maine, involuntary petitions were 
filed last year by an incarcerated prisoner against the chief 
federal district court judge and the United States 
Attorney.\25\ Abusive involuntary bankruptcy petitions have 
also been filed in Nebraska and North Carolina.\26\ In the 
Central District of California alone, it is estimated that 
approximately 11% of involuntary bankruptcy petitions commenced 
in that district over a 27-month period were likely filed in 
bad faith.\27\
---------------------------------------------------------------------------
    \21\ E-mails from Mark Evans, Counsel, Office of Legislative 
Affairs, Administrative Office of the U.S. Courts, to Susan Jensen, 
Attorney, Subcommittee on Commercial and Administrative Law of the 
Committee on the Judiciary (Apr. 16, 2003) (on file with the 
Subcommittee).
    \22\ Jury Convicts Protester of Obstruction, Bankruptcy Fraud, 
States News Service, May 23, 2002; Kevin Mayhood, Tax-Protester's 
Friend Accused of Obstruction, Columbus (Ohio) Dispatch, Apr. 3, 2002, 
at 3B; telephone interview with Keith Brown, Deputy Clerk in Charge, 
U.S. Bankruptcy Court, S.D. Ohio (May 2, 2003); telephone interview 
with Michael D. Webb, Clerk, U.S. Bankruptcy Court, S.D. Ohio (May 1, 
2003); telephone interview with Mark D'Alessandro, Assistant U.S. 
Attorney, S.D. Ohio (May 1, 2003).
    \23\ Telephone interview with Keith Brown, Deputy Clerk in Charge, 
U.S. Bankruptcy Court, S.D. Ohio (May 2, 2003).
    \24\ Id.
    \25\ Telephone interview with Celia E. Strickler, Clerk, U.S. 
Bankruptcy Court, D. Me. (May 1, 2003).
    \26\ E-mails from Mark Evans, Counsel, Office of Legislative 
Affairs, Administrative Office of the U.S. Courts to Susan Jensen, 
Attorney, Subcommittee on Commercial and Administrative Law of the 
Committee on the Judiciary (Apr. 16, 2003) (on file with the 
Subcommittee); see Christopher Tritto, Ohio Man Indicted on Federal 
Murder Charges, Charleston Gazette, Mar. 22, 2003, at 8C (reporting on 
a ``false'' involuntary petition filed by a person from North 
Carolina).
    \27\ Telephone interview with Wayne Wolf, President, National 
Conference of Bankruptcy Clerks (Apr. 10, 2003).
---------------------------------------------------------------------------
    In addition, the use of fraudulent involuntary bankruptcy 
petitions is recognized as a ``new tactic of anti-government 
extremists.'' \28\ Describing these tactics as ``an abuse'' of 
the courts, one bankruptcy clerk stated, ``This is a problem 
that is growing in scope and is damaging the credit and 
reputations of many innocent victims.'' \29\ Organizations, 
such as the Anti-Defamation League and the National District 
Attorneys Association,\30\ for example, have expressed concern 
that this tactic ``might become widespread.'' \31\
---------------------------------------------------------------------------
    \28\ Roy Korte, Terrorism: A Law Enforcement Perspective, Anti-
Defamation League (2002), at http:/www.adl.org/learn/columns/
roy5%5korte.asp.
    \29\ E-mail from Mark Evans, Counsel, Office of Legislative 
Affairs, Administrative Office of the U.S. Courts, to Susan Jensen, 
Attorney, Subcommittee on Commercial and Administrative Law of the 
Committee on the Judiciary (Apr. 16, 2003) (quoting Michael D. Webb, 
Clerk, U.S. Bankruptcy Court, S.D. Ohio) (on file with the 
Subcommittee).
    \30\ Letter from Daniel M. Alsobrooks, President, National District 
Attorneys Association, to F. James Sensenbrenner, Jr., Chairman, 
Committee on the Judiciary, May 2, 2003 (on file with Subcommittee on 
Commercial and Administrative Law).
    \31\ Jeff Cole, Paperwork Used for Revenge; Protester's Bogus 
Bankruptcy Petitions Temporarily Disrupt Officials' Credit, Milwaukee 
J. Sentinel, June 6, 2002, at 1B (quoting Mark Pitcavage, National 
Director of Fact Finding, Anti-Defamation League). The Anti-Defamation 
League has reported other instances of abusive involuntary bankruptcy 
petitions by ``sovereign citizens.'' See, e.g., Extremist-Related 
Criminal Activity, Anti-Defamation League (Feb. 16, 2001), at http://
www.adl.org/learn/criminal%5Factitivity/feb5F01.asp.
---------------------------------------------------------------------------
    H.R. 1529 responds to the problems presented by fraudulent 
involuntary bankruptcy filings in two respects. First, it 
amends the Bankruptcy Code to require the bankruptcy court on 
motion of the debtor to expunge from the court's file all 
records relating to a fraudulent involuntary petition where the 
debtor is an individual and the court dismissed the petition. 
Second, the bill amends the Bankruptcy Code to authorize a 
bankruptcy court to prohibit all credit reporting agencies from 
issuing a consumer report containing any information regarding 
the fraudulent involuntary bankruptcy petition or the case 
commenced by such petition where the debtor is an individual 
and the court dismissed the petition.

                                Hearings

    No hearings were held on H.R. 1529, the ``Involuntary 
Bankruptcy Improvement Act of 2003.''

                        Committee Consideration

    On May 7, 2003, the Committee met in open session and 
ordered favorably reported the bill H.R. 1529 without amendment 
by voice vote, a quorum being present.

                         Vote of the Committee

    In compliance with clause 3(b) of rule XIII of the Rules of 
the House of Representatives, the Committee notes that there 
were no recorded votes during the consideration of H.R. 1529.

                      Committee Oversight Findings

    In compliance with clause 3(c)(1) of rule XIII of the Rules 
of the House of Representatives, the Committee reports that the 
findings and recommendations of the Committee, based on 
oversight activities under clause 2(b)(1) of rule X of the 
Rules of the House of Representatives, are incorporated in the 
descriptive portions of this report.

                    Performance Goals and Objectives

    H.R. 1529 does not authorize funding. Therefore, clause 
3(c)(4) of rule XIII of the Rules of the House of 
Representatives is inapplicable.

               New Budget Authority and Tax Expenditures

    Clause 3(c)(2) of House rule XIII is inapplicable because 
this legislation does not provide new budgetary authority or 
increased tax expenditures.

               Congressional Budget Office Cost Estimate

    In compliance with clause 3(c)(3) of rule XIII of the Rules 
of the House of Representatives, the Committee sets forth, with 
respect to the bill, H.R. 1529, the following estimate and 
comparison prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act of 
1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, May 16, 2003.
Hon. F. James Sensenbrenner, Jr., Chairman,
Committee on the Judiciary,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 1529, the 
``Involuntary Bankruptcy Improvement Act of 2003.''
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact are Lanette J. 
Walker (for Federal costs), who can be reached at 226-2860, and 
Paige Piper/Bach (for the impact on the private sector), who 
can be reached at 226-2940.
            Sincerely,
                                       Douglas Holtz-Eakin.

Enclosure

cc:
        Honorable John Conyers, Jr.
        Ranking Member
H.R. 1529--Involuntary Bankruptcy Improvement Act of 2003.
    H.R. 1529 would require the Federal courts to expunge court 
records relating to a petition to initiate involuntary 
bankruptcy that is found to contain false or fraudulent 
statements. Based on information from the Administrative Office 
of the United States Courts, CBO estimates that the cost to 
expunge such records would have no significant impact on the 
Federal budget. Enacting H.R. 1529 would not affect direct 
spending or revenues.
    H.R. 1529 contains no intergovernmental mandates as defined 
in the Unfunded Mandates Reform Act (UMRA) and would impose no 
costs on State, local, or tribal governments.
    H.R. 1529 would impose a private-sector mandate, as defined 
in UMRA, on consumer reporting agencies. The bill would give 
Federal bankruptcy judges the authority to prohibit consumer 
reporting agencies from issuing a report containing any 
information relating to certain involuntary bankruptcy 
petitions the court has dismissed. In the event that the court 
uses such authority, the duty to comply with the prohibition 
would be considered a private-sector mandate under UMRA. 
According to industry representatives, the current practice of 
consumer reporting agencies is to not report any information 
when a court dismisses an involuntary bankruptcy petition. 
Therefore, CBO estimates that the cost of complying with such a 
mandate would be minimal, if any, and would fall well below the 
annual threshold established by UMRA for private-sector 
mandates ($117 million in 2003, adjusted annually for 
inflation).
    The CBO staff contacts for this estimate are Lanette J. 
Walker (for Federal costs), who can be reached at 226-2860, and 
Paige Piper/Bach (for the impact on the private sector), who 
can be reached at 226-2940. This estimate was approved by Peter 
H. Fontaine, Deputy Assistant Director for Budget Analysis.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds the authority for 
this legislation in article I, section 8, clause 4 of the 
Constitution.

               Section-by-Section Analysis and Discussion

    Section 1. Short Title. Section 1 of H.R. 1529 sets forth 
the short title of the bill as the ``Involuntary Bankruptcy 
Improvement Act of 2003.''
    Section 2. Amendment. Section 2 of H.R. 1529 amends section 
303 of the Bankruptcy Code in two respects. First, it adds a 
provision to section 303 requiring the bankruptcy court on 
motion of the debtor to expunge from the court's file all 
records relating to the filing of an involuntary bankruptcy 
petition and any references to such petition, under certain 
conditions. Those conditions are: (1) the petition is false or 
contains any materially false, fictitious, or fraudulent 
statement; (2) the debtor is an individual; and (3) the 
petition was dismissed by the court.
    Section 2 of the bill also amends Bankruptcy Code section 
303 to authorize a bankruptcy court to prohibit all credit 
reporting agencies from issuing a consumer report that contains 
any information relating to the involuntary bankruptcy petition 
or to the case commenced by such petition where the debtor is 
an individual and the court has dismissed the petition.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (new matter is 
printed in italics and existing law in which no change is 
proposed is shown in roman):

              SECTION 303 OF TITLE 11, UNITED STATES CODE

Sec. 303. Involuntary cases

  (a) * * *

           *       *       *       *       *       *       *

  (l)(1) If--
          (A) the petition under this section is false or 
        contains any materially false, fictitious, or 
        fraudulent statement;
          (B) the debtor is an individual; and
          (C) the court dismisses such petition;
the court, upon motion of the debtor, shall expunge from the 
records of the court such petition, all the records relating to 
such petition in particular, and all references to such 
petition.
  (2) If the debtor is an individual and the court dismisses a 
petition under this section, the court may enter an order 
prohibiting all consumer reporting agencies (as defined in 
section 603 of the Fair Credit Reporting Act) from making any 
consumer report (as defined in section 603 of the Fair Credit 
Reporting Act) that contains any information relating to such 
petition or to the case commenced by the filing of such 
petition.

                           Markup Transcript



                            BUSINESS MEETING

                         WEDNESDAY, MAY 7, 2003

                  House of Representatives,
                                Committee on the Judiciary,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10:00 a.m., in 
Room 2141, Rayburn House Office Building, Hon. F. James 
Sensenbrenner, Jr. [Chairman of the Committee] presiding.
    [Intervening business.]
    Chairman Sensenbrenner. The next item on the agenda 
pursuant to notice, I now call up the bill H.R. 1529, the 
``Involuntary Bankruptcy Improvement Act of 2003,'' for 
purposes of markup and move its favorable recommendation to the 
full House. Without objection, the bill will be considered as 
read and open for amendment at any point.
    [The bill, H.R. 1529, follows:]
    
    
    Chairman Sensenbrenner. And I recognize myself for 5 
minutes to explain the bill.
    Under current law, a debtor can voluntarily commence a 
bankruptcy or involuntarily case be forced into bankruptcy by 
one or more creditors. Although rarely used, an involuntary 
bankruptcy petition can be a useful creditor collection tool 
that can preserve assets from further dissipation and provide 
for their orderly liquidation by the trustee.
    Unfortunately, tax protesters and other extremists are now 
resorting to filing fraudulent involuntary bankruptcy petitions 
against public officials and private individuals as yet another 
weapon in their arsenal of mischievous litigation tactics such 
as filing false liens.
    Last year, for example, a tax protester filed fraudulent 
involuntary bankruptcy petitions against 36 local public 
officials, including the sheriff, nearly every member of the 
county board of supervisors, and a county circuit court judge 
in my district in Wisconsin. Some of these individuals only 
discovered that they were the subject of a pending involuntary 
bankruptcy after their lines of credit were terminated or they 
were charged higher interest rates.
    Worse yet, an involuntary bankruptcy filing, as with most 
bankruptcy cases, is a matter of public record and can appear 
on an individual's credit report for up to 10 years, even if 
the involuntary bankruptcy is fraudulent and the case is 
dismissed by the court. As a result, innocent individuals 
continue to experience credit problems long after these abusive 
cases are dismissed.
    While abusive involuntary bankruptcy filings are not 
pervasive, they have occurred in various districts across the 
Nation. According to an informal survey conducted by the 
Administrative Office of the U.S. Courts and the National 
Conference of Bankruptcy Clerks, fraudulent involuntary 
bankruptcies have been filed in California, Ohio, Maine, 
Nebraska and North Carolina.
    Indeed, organizations such as the Anti-Defamation League 
and the National District Attorneys Association have expressed 
concern that this litigation tactic may become even more 
widespread.
    This bill responds to the problems presented by abusive 
involuntary bankruptcy filings in two respects. First, it 
amends the Bankruptcy Code to require the bankruptcy court, on 
the motion of the debtor, to expunge all records relating to a 
fraudulent involuntary bankruptcy from the court's files under 
certain conditions.
    Second, it authorizes the bankruptcy court to prohibit all 
credit reporting agencies from issuing a consumer report 
containing any reference to a fraudulent involuntary bankruptcy 
where the debtor is an individual and the court has dismissed 
the petition.
    I urge the support of this legislation. Yield back my time. 
The gentleman from Virginia?
    Mr. Scott. Thank you, Mr. Chairman. Mr. Chairman, this is a 
narrowly tailored bill to address a real problem. People 
subjected to this are hurt grievously, and this bill will do a 
lot to restore their good credit, and I support the bill and 
yield back the balance of my time.
    Chairman Sensenbrenner. All Members, with unanimous 
consent, may include opening statements in the record at this 
point.
    Are there amendments? Are there amendments? There are no 
amendments. A reporting quorum is not present, and the previous 
question is ordered on the motion to report the bill favorably.
    [Intervening business.]
    The unfinished business is the bill H.R. 1529, the 
``Involuntary Bankruptcy Improvement Act of 2003.'' The Chair 
notes the presence of a reporting quorum. The question is on 
reporting the bill favorably.
    Those in favor will say aye.
    Opposed, no.
    The ayes appear to have it. The ayes have it. The motion is 
agreed to.
    Without objection, the Chair is authorized to move to go to 
conference pursuant to House rules. Without objection, the 
staff is authorized to make technical and conforming changes, 
and all Members will be given 2 days, pursuant to House rules, 
in which to submit additional supplemental minority or 
dissenting views.