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Improving Fraudulent Transfer Law In Leverage Buy-Outs Through Judicial Certainty & Reliability, Vincent V. Hilldrup

Vincent V. Hilldrup

LBOs that file for bankruptcy are routinely challenged under fraudulent transfer law, where plaintiffs allege that the LBO unreasonably reduced the target’s liquidity and capital adequacy, saddled it with debt and was completed as a means of funneling company assets to both current and former shareholders. These cases will bestow upon bankruptcy courts the responsibility and power of efficiently allocating billions of dollars to classes of creditors and clawing back funds from shareholders. Since these cases will have a crucial impact on the overall economy, it is imperative that bankruptcy courts wield their authority and power in a predictable, fair, …