Bankruptcy Law Commons^™

Allocation Of Property Appreciation: A Statutory Approach To The Judicial Dialectic, Lawrence Ponoroff

William & Mary Business Law Review

Many, perhaps the majority, of Chapter 13 cases end up being converted to Chapter 7. The converted Chapter 7 case is not a new case, it is a continuation of the case that was commenced with the filing of the original Chapter 13 petition. However, there are important structural differences between the two chapters, including over what constitutes property of the estate. This creates some thorny issues surrounding whether property of the estate as generally defined in section 541(a) of the Bankruptcy Code or property of the estate as specifically defined in Chapter 13 controls in determining the scope of …

Lending A Hand Instead Of Breaking The Bank: The Imperative Need To Resolve The Circuit Split For Determining Undue Hardship For Section 523(A)(8) Student Loan Discharges, Rucha Pandit

William & Mary Business Law Review

The Bankruptcy Code permits petitioners to discharge their student debts if they are able to demonstrate that their loans impose an undue hardship. Somewhat frustratingly, the Code does not define what exactly constitutes undue hardship in the context of student loan discharges. Moreover, neither Congress nor the Supreme Court has broken its silence to offer guidance on the issue. As a result, the rest of the federal judiciary has been once again, left to its own devices.

Over the past few decades, the Brunner and totality-of-the-circumstances tests have emerged as the standards that federal circuits choose between to assess whether …

Absolute Priority Redux: First-Day Orders And Pre-Plan Settlements In Chapter 11 Post-Jevic, Bruce Grohsgal

William & Mary Business Law Review

This Article considers the problem of priority-skipping distributions made by a chapter 11 debtor outside of a plan, following the Supreme Court’s Jevic decision. The Jevic Court extended the absolute priority rule—which under U.S. bankruptcy enactments dictates the order of distributions to creditors under a chapter 11 cramdown plan and in a chapter 7 liquidation—to a chapter 11 case-ending settlement known as a “structured dismissal.”

The Jevic Court limited its holding to a case-ending settlement. It did not extend the absolute priority rule to an interim or pre-plan settlement or other transaction that is not case-ending or to a “first-day” …

Rethinking Preemption And Constitutional Parameters In Bankruptcy, Michelle M. Harner

William & Mary Law Review

Chapter 11 of the U.S. Bankruptcy Code allows financially distressed businesses to reorganize and emerge from bankruptcy free of their pre-bankruptcy debts and obligations. In general, a business can achieve this kind of “fresh start” by confirming a plan of reorganization or pursuing a going-concern sale that typically facilitates a change in ownership, a reduction in leverage, and the elimination of most claims against the company’s assets. Through these kinds of transactions, a business can emerge from bankruptcy with a stronger balance sheet and often a new ownership structure. It also can streamline operations by, for example, assuming valuable contracts …

How Absolute Is The Absolute Priority Rule In Bankruptcy? The Case For Structured Dismissals, Bruce Grohsgal

William & Mary Business Law Review

This Article challenges the view that the absolute priority rule applies to a “structured dismissal” in a chapter 11 bankruptcy case, namely a court-approved settlement of certain claims by or against the debtor followed by the dismissal of the case. Under that view, the bankruptcy court cannot approve a settlement that makes a distribution to holders of junior claims unless it also provides for payment of all senior claims in full. The Supreme Court considered the question in the fall of 2016 in Czyzewski v. Jevic Holding Corp. (In re Jevic Holding Corp.). The question before the Court is: “Whether …

From Wreckage Comes Reason: How Detroit’S Chapter 9 Filing Helps Develop A Practicable And Principled “Good Faith” Standard, Scott A. Krystiniak

William & Mary Business Law Review

The city of Detroit is beginning to rise from the ashes following decades of fiscal ineptitude, social failure, and corruption. Bolstered by protections under Chapter 9 of the Bankruptcy Code, Detroit has eliminated billions of dollars in debt and established a feasible plan for municipal reorganization. Now, Detroit is even considered an American “comeback story.” However, Detroit’s revitalization began on a tenuous foundation. The city’s creditors objected vigorously to the bankruptcy petition by claiming that Detroit had not filed its bankruptcy petition in good faith under § 921(c). Despite the relatively scarce and imprecise case law and jurisprudence surrounding § …

With Malice Toward One? – Defining Nondischargeability Of Debts For Willful And Malicious Injury Under Section 523(A)(6) Of The Bankrupcy Code, Theresa J. Pulley Radwan

William & Mary Business Law Review

The federal bankruptcy system strikes a balance between the rights of debtors seeking a fresh start and the rights of creditors seeking repayment for debt. While many areas of the Bankruptcy Code provide examples of this balancing act, perhaps no area of the Code embodies this balance better than discharge of debt. Discharge of debt provides the fresh start for debtors on which the bankruptcy system rests, but the Code also protects the interests of creditors who would otherwise have their claims against the debtor discharged.

Section 523(a)(6) excepts from discharge any debt “for willful and malicious injury by the …

A New Fulcrum Point For City Survival, Samir D. Parikh

William & Mary Law Review

Municipalities have historically enjoyed immense stability. This era of tranquility is over, and fiscal deterioration is accelerating. Policymakers and scholars have struggled to formulate debt restructuring options; almost all have embraced federal bankruptcy law. But this resource-draining process is not the fulcrum point for any meaningful solution to municipal demise. Indeed, for the vast majority of distressed municipalities, the lever of municipal recovery will not turn on the solutions that have been offered to date. This Article radically shifts the municipal recovery debate by arguing that state law is the centralized point at which officials can exert the necessary amount …

When Should Bankruptcy Be An Option (For People, Places, Or Things)?, David A. Skeel Jr.

William & Mary Law Review

When many people think about bankruptcy, they have a simple left-to-right spectrum of possibilities in mind. The spectrum starts with personal bankruptcy, moves next to corporations and other businesses, and then to municipalities, states, and finally countries. We assume that bankruptcy makes the most sense for individuals; that it makes a great deal of sense for corporations; that it is plausible but a little more suspect for cities; that it would be quite odd for states; and that bankruptcy is unimaginable for a country.

In this Article, I argue that the left-to-right spectrum is sensible but mistaken. After defining “bankruptcy,” …

When Opting Out Is The Only Option: Protecting Small Business Debtors In Bankruptcy, Ryan Malone

William & Mary Business Law Review

This Note implores states that have not already done so to opt out of the provisions of the Federal Bankruptcy Code that place explicit limits on the amount a debtor is allowed to exempt from liquidation. By doing so, states will be able to provide debtors who operate their own small business a greater degree of protection from creditors, as those states are entitled to establish their own limit on the value of the tools of a debtor’s trade the debtor may shield in bankruptcy. This Note contends that Congress has evinced an intent within the last decade to restrict …

Dodd-Frank's Title Ii Authority: A Disorderly Liquidation Of Experience, Logic, And Due Process, Chadwick Welch

William & Mary Bill of Rights Journal

No abstract provided.

Does Ideology Matter In Bankruptcy? Voting Behavior On The Courts Of Appeals, Jonathan Remy Nash, Rafael I. Pardo

William & Mary Law Review

This Article empirically examines whether courts of appeals judges cast ideological votes in the bankruptcy context. The empirical study is unique insofar as it is the first to examine the voting behavior of circuit court judges in bankruptcy cases. More importantly, it focuses on a particular type of dispute that arises in bankruptcy: debt-dischargeability determinations. The study implements this focused approach in order to reduce heterogeneity in result. We find, contrary to our hypotheses, no evidence that circuit court judges engage in ideological voting in bankruptcy cases. We also find, however, non-ideological factors—including the race of the judge and the …

The Affordability Paradox: How Consumer Bankruptcy's Greatest Weakness May Account For Its Surprising Success, Angela Littwin

William & Mary Law Review

When the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) made consumer bankruptcy more expensive for all debtors, it inadvertently reignited a debate about how to make the system more affordable for its neediest beneficiaries. Even before BAPCPA, consumer bankruptcy suffered from the irony that those who needed it the most were often too poor to take advantage of its relief.

The seemingly obvious solution to this problem is to eliminate the major cost that consumer bankruptcy filers bear, that of paying their own lawyers. But in our rush to undo the harm caused by BAPCPA’s worsening of the …

"Some Portion Of Misconduct": The Argument For A Negligence Standard For Expecting Discharge Of Debts Incurred Through Defalcation, Alyssa Miller

William & Mary Business Law Review

The United States Circuit Courts are currently split on the correct standard for defalcation: that is, they are split on what level of mental culpability a fiduciary must possess before bankruptcy courts exclude debts incurred through misconduct from discharge. The First, Fifth, Sixth, and Seventh Circuits apply a recklessness standard. The Fourth, Eighth, and Ninth Circuits apply a negligence standard. The time has come to resolve the circuit split because the inter-jurisdictional nature of business in the twenty-first century creates a danger that fiduciaries will not have notice of potential liability if standards for liability vary from jurisdiction to jurisdiction. …

Looking Forward While Looking Back: Using Debtors' Post-Petition Financial Changes To Find Bankruptcy Abuse After Bapcpa, Justin H. Rucki

William & Mary Law Review

No abstract provided.

An Appeal To Equity: Why Bankruptcy Courts Should Resort To Equitable Powers For Latitude In Their Interpretation Of "Interests" Under Section 363(F) Of The Bankruptcy Code, Matthew T. Gunlock

William & Mary Law Review

No abstract provided.

Muddy Property: Generating And Protecting Information Privacy Norms In Bankruptcy, Edward J. Janger

William & Mary Law Review

Bankruptcy law does not deal well with website promises to protect personal information. The legal treatment of privacy policies in bankruptcy currently turns on whether such policies are viewed as creating contract rights or property rights. Neither characterization fits well, and any attempt to shoehorn information privacy into either category has significant costs. Contract obligations are subject to discharge in bankruptcy, and any consumer expectations of privacy (contractual or otherwise) are likely to be defeated. By contrast, if personal information is deemed property of the website customer, information transfers that might benefit consumers will be stifled. This Article develops an …

Confusion And Solution: Chapter 11 Bankruptcy Trustee's Standard Of Care For Personal Liability, David P. Primack

William & Mary Law Review

No abstract provided.

Will Big Tobacco Seek Bankruptcy Protection? A $145 Billion Verdict Poses The Question, Mark Gottlieb, Richard A. Daynard

William & Mary Environmental Law and Policy Review

No abstract provided.

On The Nature Of Federal Bankruptcy Jurisdiction: A General Statutory And Constitutional Theory, Ralph Brubaker

William & Mary Law Review

No abstract provided.

The Rotten Foundations Of Securitization, David Gray Carlson

William & Mary Law Review

No abstract provided.

What Should You Notice When You Get Notice?: Undiscovered But Discoverable Environmental Claims In Bankruptcy, Royanne Kashiwahara Doi, H. Hammer Hill

William & Mary Environmental Law and Policy Review

No abstract provided.

"Cramdown" Confirmation Of Single-Asset Debtor Reorganization Plans Through Separate Classification Of The Deficiency Claim - How In Re U.S. Truck Co. Was Run Off The Road, King F. Tower

William & Mary Law Review

No abstract provided.

The Continuing Puzzle Of Collective Bargaining Agreements In Bankruptcy, Daniel Keating

William & Mary Law Review

No abstract provided.

The Direct Action Against Insurers In Cercla Insolvency Cases: An Ideal Whose Time Has Come?, Peter R. Mounsey

William & Mary Environmental Law and Policy Review

No abstract provided.

No Fault Equitable Subordination: Reassuring Investors That Only Government Penalty Claims Are At Risk, Scott M. Browning

William & Mary Law Review

No abstract provided.

Value And Rationality In Bankruptcy Decisionmaking, Donald R. Korobkin

William & Mary Law Review

No abstract provided.

Chapter 13'S Liberal Discharge Provisions And "Willful And Malicious" Tort Judgments: Creditor Classification As A Means Of Accounting For The Debtor's Egregious Action, Robert L. Miller

William & Mary Law Review

No abstract provided.

The 1978 Bankruptcy Reform Act's Police Or Regulatory Power Exemption To The Automatic Stay: Unnecessary, Unfounded, And Unrestrained, Robert E. Korroch

William & Mary Law Review

No abstract provided.

Does Section 524 (A)(2) Of The Bankruptcy Code Bar Criminal Prosecution Concerning Discharged Debts?, Kent A. Bieberich

William & Mary Law Review

No abstract provided.