Bankruptcy Law Commons^™

Duped By Dope: The Sackler Family’S Attempt To Escape Opioid Liability And The Need To Close The Non-Debtor Release Loophole, Bryson T. Strachan

Law Student Publications

The opioid epidemic continues to rage on in the United States, ravaging its rural populations. One of its main causes? OxyContin. Purdue Pharma (“Purdue”), the maker of OxyContin, aggressively marketed opioids to the American public while racking up a fortune of over $13 billion dollars for its owners,3 the Sackler family. As a result, roughly 3,000 lawsuits were filed against Purdue and members of the Sackler family. Generally, the lawsuits alleged that Purdue and members of the Sackler family knew OxyContin was highly addictive yet aggressively marketed high dosages of the drug and misrepresented the drug as nonaddictive and without …

Amicus Curiae Brief Of The Hon. Judith Fitzgerald (Bankruptcy Judge, Ret.), And Law Professors Pamela Foohey, George Kuney, Robert Lawless, Jonathan Lipson, Bruce A. Markell, Nancy Rapoport, Richard Squire, Ray Warner And Jack Williams, In Support Of The Petitioner, Pamela Foohey

Amicus Briefs

Your amici have taught courses on bankruptcy and commercial law, conducted research, and have been frequent speakers and lecturers at seminars and conferences throughout the United States. Each is highly regarded in this field, and each has made substantial contributions to bankruptcy scholarship and jurisprudence.

The question presented to this Court is as follows: “Whether Bankruptcy Code Section 363(m) limits the appellate court’s jurisdiction over any sale order or order deemed integral to a sale order. . . .” (emphasis added). Pet. i. The answer is that § 363(m) does not limit appellate review of the transaction involved in this …

Portraits Of Bankruptcy Filers, Pamela Foohey, Robert M. Lawless, Deborah Thorne

Articles

One in ten adult Americans has turned to the consumer bankruptcy system for help. For almost forty years, the only systematic data collection about the people who file bankruptcy has come from the Consumer Bankruptcy Project (CBP), for which we serve as co-principal investigators. In this Article, we use CBP data from 2013 to 2019 to describe who is using the bankruptcy system, providing the first comprehensive overview of bankruptcy filers in thirty years. We use principal component analysis to leverage these data to identify distinct groups of people who file bankruptcy. This technique allows us to situate the distinctions …

Consumer Bankruptcy And Race: Current Concerns And A Proposed Solution, Edward J. Janger

Faculty Scholarship

No abstract provided.

Bringing Relevance Back To Consumer Bankruptcy, Nathalie Martin

Faculty Scholarship

The Seventeenth Annual Emory Bankruptcy Developments Journal Symposium

This Paper presumes that readers want to make bankruptcy more useful for consumers and for society as a whole. If this is true, we need to ask two questions: first, what do individual consumers hope to get out of the system, and second, what does society hope to get out of the system?

Part I of this Paper discusses the increase in debt over the last two decades, the growing wage and income gap, growing debt inequality and race, and the fall of the CFPB, all justifications for using the bankruptcy system …

Consumer Bankruptcy Panel: Bringing Relevance Back To Consumer Bankruptcy, Pamela Foohey, Daniel Keating, David A. Lander, Nathalie Martin, Sage M. Sigler

Articles by Maurer Faculty

No abstract provided.

Consumer Bankruptcy Should Be Increasingly Irrelevant - Why Isn't It?, Pamela Foohey

Articles by Maurer Faculty

There are important reasons why consumer bankruptcy remains relevant, even if consumers’ and bankruptcy’s interests have diverged. Some of these reasons suggest that it is more relevant than ever. The remainder of this response overviews the place consumer bankruptcy presently occupies in the United States. In doing so, I detail why consumer bankruptcy remains relevant in the face of a socio-economic structure and of laws that suggest that bankruptcy may not be a particularly useful place for struggling Americans to turn to for help. The response ends by calling for a bolder vision for consumer bankruptcy in light of the …

Debt In Just Societies: A General Framework For Regulating Credit, John Linarelli

Scholarly Works

Debt presents a dilemma to societies: successful societies benefit from a substantial infrastructure of consumer, commercial, corporate, and sovereign debt but debt can cause substantial private and social harm. Pre- and post-crisis solutions have seesawed between subsidizing and restricting debt, between leveraging and deleveraging. A consensus exists among governments and international financial institutions that financial stability is the fundamental normative principle underlying financial regulation. Financial stability, however, is insensitive to equality concerns and can produce morally impermissible aggregations in which the least advantaged in a society are made worse off. Solutions based only on financial stability can restrict debt without …

A New Deal For Debtors: Providing Procedural Justice In Consumer Bankruptcy, Pamela Foohey

Articles by Maurer Faculty

Across the criminal and civil justice systems, research regarding procedural justice — feeling that one has a voice, is respected, and is before a neutral and even-handed adjudicator — shows that people’s positive perceptions of legal processes are fundamental to the legal system’s effectiveness and to the rule of law. About a million people file bankruptcy every year, making the consumer bankruptcy system the part of the federal court system with which people most often come into contact. Given the importance of bankruptcy to American families and the credit economy, there should exist a rich literature theorizing and investigating how …

Access To Consumer Bankruptcy, Pamela Foohey

Articles by Maurer Faculty

This essay examines the state of access to justice in the context of consumer bankruptcy from two vantage points: (1) how people decide that their money problems are legal problems addressable by filing bankruptcy; and (2) the barriers people face in using the consumer bankruptcy system. To shed new light on how people decide to use bankruptcy to address their financial troubles, I analyze a sample of narratives accompanying consumers' complaints about financial products and services submitted to the Consumer Financial Protection Bureau. I also chronicle the evolution of research regarding consumer bankruptcy’s “local legal culture,” systemic racial bias, and …

Commodifying Consumer Data In The Era Of The Internet Of Things, Stacy-Ann Elvy

Articles & Chapters

Internet of Things (“IOT”) products generate a wealth of data about consumers that was never before widely and easily accessible to companies. Examples include biometric and health-related data, such as fingerprint patterns, heart rates and calories burned. This Article explores the connection between the types of data generated by the IOT and the financial frameworks of Article 9 of the Uniform Commercial Code and the Bankruptcy Code. It critiques these regimes, which enable the commodification of consumer data, as well as laws aimed at protecting consumer data, such as the Bankruptcy Abuse Prevention and Consumer Protection Act, various state biometric …

K&P Homes V. Christiana Trust, 133 Nev. Adv. Op. 51 (July 27, 2017), Yolanda Carapia

Nevada Supreme Court Summaries

The Court determined that the SFR Investments Pool 1, LLC v. U.S. Bank, N.A. decision, extinguishing first security interests, applies retroactively to all foreclosures occurring prior to the date of the decision and since NRS 116.3116’s inception.

Rethinking Criminal Contempt In The Bankruptcy Courts, John A. E. Pottow, Jason S. Levin

Law & Economics Working Papers

A surprising number of courts believe that bankruptcy judges lack authority to impose criminal contempt sanctions. We attempt to rectify this misunderstanding with a march through the historical treatment of contempt-like powers in bankruptcy, the painful statutory history of the 1978 Bankruptcy Code (including the exciting history of likely repealed 28 U.S.C. § 1481), and the various apposite rules of procedure. (Fans of the All Writs Act will delight in its inclusion.) But the principal service we offer to the bankruptcy community is dismantling the ubiquitous and persistent belief that there is some form of constitutional infirmity with "mere" bankruptcy …

"No Money Down" Bankruptcy, Pamela Foohey, Robert M. Lawless, Katherine Porter, Deborah Thorne

Articles by Maurer Faculty

This Article reports on a breakdown in access to justice in bankruptcy, a system from which one million Americans will seek help this year. A crucial decision for these consumers will be whether to file a chapter 7 or chapter 13 bankruptcy. Nearly every aspect of their bankruptcies — both the benefits and the burdens of debt relief — will be different in chapter 7 versus chapter 13. Almost all consumers will hire a bankruptcy attorney. Because they must pay their attorneys, many consumers will file chapter 13 to finance their access to the law, rather than because they prefer …

Energy Derivatives: Which Country (U.S. Or U.K.) Provides The Best Customer Asset Protections To An Energy Trading Firm If Its Brokerage Firm/Counterparty Files For Bankruptcy, Ronald H. Filler

Articles & Chapters

No abstract provided.

"We Buy Houses": Market Heroes Or Criminals?, Cori Harvey

Journal Publications

The residential sale/leaseback/buyback transaction is a socially beneficial foreclosure rescue transaction that is being regulated increasingly by the criminal courts to the detriment of the homeowners, investors, and society at large. Because the transaction is being regulated more aggressively with the criminal law, peculiar outcomes arise, which include investors being sentenced, in some cases, to draconian sentences --a trend that will eviscerate the transactions rather than improving them.

In calling for a retreat from that position, this Article makes both descriptive and prescriptive claims. The first descriptive claim is that the transaction is a beneficial one and that it has …

Seeking Solutions To Financial History Discrimination, Lea Krivinskas Shepard

Faculty Publications & Other Works

Employers’ use of credit reports to evaluate prospective job applicants has generated considerable scrutiny in the popular press and academic literature, but few proposals for reform. This Article explores three possible ways of reducing the risk of financial history discrimination in the employment setting.

First, imposing inquiry limits on employers’ use of credit reports, a policy recently adopted or under consideration in the majority of states, is unlikely to be effective, since states’ inquiry limits are currently narrowly drafted and therefore advance few anti-discriminatory objectives. In addition, inquiry limits cannot prevent self-interested individuals from voluntarily revealing their credit histories and …

"We Buy Houses": A Foreclosure Rescue As The Solution To The Trapped Homeowner Equity Problem, Cori Harvey

Journal Publications

Foreclosure rescue transactions are viewed widely as scams designed, among other things, to dupe poor, minority, and elderly homeowners out of the equity in their homes. However, foreclosure rescue transactions come in many forms and, as an alternative to foreclosure, often maintain valuable options for homeowners that the homeowners otherwise would lose in the traditional foreclosure process. For this reason, many of these transactions, though imperfect, should be preserved and supported.

This Article introduces one such foreclosure rescue transaction, the residential sale/leaseback/buyback ("RSLB") transaction, into the legal literature from the perspective of the rescue investors. A basic RSLB transaction allows …

Clearinghouses As Liquidity Partitioning, Richard Squire

Faculty Scholarship

To reduce the risk of another financial crisis, the Dodd-Frank Act requires that trading in certain derivatives be backed by clearinghouses. Critics mount two main objections: a clearinghouse shifts risk instead of reducing it; and a clearinghouse could fail, requiring a bailout. This Article’s observation that clearinghouses engage in liquidity partitioning answers both. Liquidity partitioning means that when one of its member firms becomes bankrupt, a clearinghouse keeps a portion of the firm’s most liquid assets, and a matching portion of its short-term debt, out of the bankruptcy estate. The clearinghouse then applies the first toward immediate repayment of the …

Improving The Lives Of Individuals In Financial Distress Using A Randomized Control Trial: A Research And Clinical Approach, Lois R. Lupica, Dalie´ Jimenez, D. James Greiner, Rebecca L. Sandefur

Faculty Publications

This Article describes an ambitious Randomized Control Trial (RCT) in the area of consumer debt collection. Randomized trials are the same kind of evaluation that the law requires (or at least strongly encourages) before new drugs and medical devices may be sold to the public. Although they have not yet gained widespread popularity in the evaluation of legal systems, randomized trials are uniquely effective ways of assessing whether any benefits observed after implementation of legal or educational assistance programs are really due to those programs as compared to other factors, such as unusual levels of competence or motivation of program …

Still Chasing Chimeras But Finally Slaying Some Dragons In The Quest For Consumer Bankruptcy Reform, 25 Loy. Consumer L. Rev. 1 (2012), Jason Kilborn

UIC Law Open Access Faculty Scholarship

Consumer bankruptcy systems in Europe and the United States have witnessed especially robust and dynamic development during the past decade. The ever-rising volume of seeking entry to these systems now allows for cross-systemic comparisons of substantially differing “markets” for the relief that these systems offer. In particular, the distinct trend toward greater efficiency seen in other financial markets can be increasingly observed in most consumer bankruptcy regimes, with some notable exceptions. In this context, market performance can be gauged in part by the degree to which systems offer efficient and effective relief as a stimulus to deploying available debtor resources …

Mortgage Foreclosures, Mortgage Morality, And Main Street: What’S Really Happening?, Jennifer M. Smith

Journal Publications

The American economy is in the tank. Millions of citizens are without jobs, overwhelmed with credit card debt, and losing their homes. The brighter side is that as a result, America has finally embraced financial reform, and the unstable economy is stabilizing marriages. Nevertheless, the United States remains in the midst of a housing crisis, and the ending remains uncertain.

There has been a media blitz about the housing crisis and Wall Street - corporate interests, but much less about the actual impact of the housing crisis on Main Street - America's working class people and small business owners. This …

Financial Literacy Or Financial Castigation?, John A. E. Pottow

Articles

This year, the Canadians- through their government-convened Task Force on Financial Literacy - have proudly produced, "Canadians and their Money: Building a Brighter Financial Future." Armed with 30 recommendations, its most dramatic innovation is to recommend the creation of a Financial Literacy Leader. I have been asked to provide an American perspective on this report specifically and the broader agenda of "financial literacy" more generally as a consumer welfare intervention. Let me start by acknowledging the critiques of the Canadian Task Force. For example, my Canadian colleague, Saul Schwartz, has already drafted a compelling analysis of the political economy behind …

Debts, Defaults And Details: Exploring The Impact Of Debt Collection Litigation On Consumers And Courts, Mary B. Spector

Faculty Journal Articles and Book Chapters

This Article explores consumer collection litigation through original research from more than five hundred cases filed in the Dallas County courts. It analyzes the data within the context of the modern debt collection industry, paying special attention to the role of debt buyers and to the peculiar legal issues their involvement raises. After explaining the methodology and mechanics used to gather and analyze the data, the Article discusses the data collected, identifying and analyzing the most significant findings and placing them within a larger legal landscape. While the research confirms anecdotal reports of litigation abuse in consumer collection cases, it …

Ask The Professor: “Omg! What Did Mf Global Do?, Ronald Filler

Articles & Chapters

This paper, written one week after MF Global, a large futures brokerage firm filed for bankruptcy, analyzes the bankruptcy, its impact on futures customers and the shortfall in customer funds that occurred on October 31, 2011. Subsequent to MF Global's bankruptcy, several customer protection rules were amended by the U.S. Commodity Futures Trading Commission and the National Futures Association.

The Rise In Elder Bankruptcy Filings And Failure Of U.S. Bankruptcy Law, John A. E. Pottow

Law & Economics Working Papers

Recent empirical legal scholarship on the consumer bankruptcy system has uncovered a marked rise in the proportion of elder Americans filing for relief under the Bankruptcy Code. But these studies have not probed the reasons behind that rise, an omission this Article seeks to address. Professor John Pottow and colleagues recently assembled the new dataset of the Consumer Bankruptcy Project (CBP), the largest national sample of consumer debtors in this country, which he uses to explore the sources of elder bankruptcy. The findings are both striking and ominous. While multiple factors, such as health problems and medical debts, contribute to …

Virtual Territoriality, Edward J. Janger

Faculty Scholarship

No abstract provided.

Demand-Side Gatekeepers In The Market For Home Loans, Edward J. Janger, Susan Block-Lieb

Faculty Scholarship

No abstract provided.

Accessing Insolvent Consumer Debtors, Challenges And Strategies For Empirical Research, Janis P. Sarra, Danielle Sarra

All Faculty Publications

Insolvency law policy is best informed by a comprehensive understanding of the policy objectives of particular measures and the practical outcomes of particular choices. Yet there continues to be a lack of empirical research in Canada in respect of consumer insolvency, its underlying causes and its outcomes. Debtors' or bankrupts' experience with the insolvency system is almost impossible to gauge with the data now collected. Research funding for legal, economic and sociological scholars in the insolvency area continues to be very limited. This paper examines current challenges and strategies for empirical research on consumer insolvency in Canada. It explores options …

Economic Rehabilitation: Understanding The Growth In Consumer Proposals Under Canadian Insolvency Legislation, Janis P. Sarra

All Faculty Publications

Economic rehabilitation is the notion underlying Canada’s Bankruptcy and Insolvency Act (BIA), providing consumer debtors with an opportunity for a “fresh start” through the mechanism of bankruptcy or making a proposal to their creditors for payment of their debts on terms that allow them to rehabilitate their financial status. This article undertakes a comparison of consumer proposals and consumer bankruptcies, examining 5,773 individual insolvencies in the past two years, with a view to discerning choices by individual insolvent debtors of insolvency proceeding. It compares causes of financial distress, income levels, quantum of debt and the assets of those filing proposals …