ABSTRACT
Cannabis companies, both direct and ancillary, are effectively prohibited from accessing the protections of federal bankruptcy law. Hemp companies, however, seem to be able to access federal bankruptcy. While federal bankruptcy is not an option for cannabis companies, they can avail themselves of out-of-court workouts and state-level remedies such as receiverships and assignments for the benefit of creditors. Transferring cannabis licenses in an insolvency situation can be difficult and only some states have created mechanisms to accomplish this outside of normal procedures.
