PUBLIC LAW 109–8—APR. 20, 2005
119 STAT. 115
2-year period ending on the date of the order for relief entered with respect to the petition; ‘‘(C) was a debtor in a small business case in which a plan was confirmed in the 2-year period ending on the date of the order for relief entered with respect to the petition; or ‘‘(D) is an entity that has acquired substantially all of the assets or business of a small business debtor described in subparagraph (A), (B), or (C), unless such entity establishes by a preponderance of the evidence that such entity acquired substantially all of the assets or business of such small business debtor in good faith and not for the purpose of evading this paragraph. ‘‘(2) Paragraph (1) does not apply— ‘‘(A) to an involuntary case involving no collusion by the debtor with creditors; or ‘‘(B) to the filing of a petition if— ‘‘(i) the debtor proves by a preponderance of the evidence that the filing of the petition resulted from circumstances beyond the control of the debtor not foreseeable at the time the case then pending was filed; and ‘‘(ii) it is more likely than not that the court will confirm a feasible plan, but not a liquidating plan, within a reasonable period of time.’’. SEC. 442. EXPANDED GROUNDS FOR DISMISSAL OR CONVERSION AND APPOINTMENT OF TRUSTEE.
(a) EXPANDED GROUNDS FOR DISMISSAL OR CONVERSION.—Section 1112 of title 11, United States Code, is amended by striking subsection (b) and inserting the following: ‘‘(b)(1) Except as provided in paragraph (2) of this subsection, subsection (c) of this section, and section 1104(a)(3), on request of a party in interest, and after notice and a hearing, absent unusual circumstances specifically identified by the court that establish that the requested conversion or dismissal is not in the best interests of creditors and the estate, the court shall convert a case under this chapter to a case under chapter 7 or dismiss a case under this chapter, whichever is in the best interests of creditors and the estate, if the movant establishes cause. ‘‘(2) The relief provided in paragraph (1) shall not be granted absent unusual circumstances specifically identified by the court that establish that such relief is not in the best interests of creditors and the estate, if the debtor or another party in interest objects and establishes that— ‘‘(A) there is a reasonable likelihood that a plan will be confirmed within the timeframes established in sections 1121(e) and 1129(e) of this title, or if such sections do not apply, within a reasonable period of time; and ‘‘(B) the grounds for granting such relief include an act or omission of the debtor other than under paragraph (4)(A)— ‘‘(i) for which there exists a reasonable justification for the act or omission; and ‘‘(ii) that will be cured within a reasonable period of time fixed by the court. ‘‘(3) The court shall commence the hearing on a motion under this subsection not later than 30 days after filing of the motion,
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