Law Commons^™

Bankruptcy Law And Inefficient Entitlements, Irit Haviv-Segal

ExpressO

The question as to the justification of bankruptcy law remains unanswered. The literature tends to emphasize the conflict and inability to compromise between the different normative outlooks of the insolvency law system. A deeper reflection on the existing theories of bankruptcy law reveals, however, that all theories share the same starting point: All theories share the understanding that efficiency considerations justify the enforcement of contractual bankruptcy arrangements. When the social theories call for increased levels of coercion and redistribution, these theories rely on normative considerations of distributive justice and rehabilitation values. They by no means rely on efficiency grounds. This …

Can A Bankrupt Company Assign Its Patent License To The Highest Bidder, Even When The License Itself Forbids Assignment? Why Everex Systems, Inc. V. Cadtrak Corp. Gives An Unconvincing Answer, Matthew D. Siegel

ExpressO

A patent licensee that declares bankruptcy will often want to assign its rights under the license to another party in exchange for much-needed cash. The Bankruptcy Code generally allows debtors to assign executory contracts, including patent licenses, in this way. Indeed, the Code permits debtors to assign a contract even if the contract itself contains a “no-assign” clause, i.e., a clause expressly forbidding assignment. But there is an exception: The Code will defer to certain kinds of otherwise applicable non-bankruptcy law that would normally prevent the contract from being assigned. In particular, the Code will not allow assignment by a …

The End Of Notice: Secrets And Liens In Commercial Finance Law, Jonathan C. Lipson

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This article explores important recent changes in the way that we treat personal property in commercial finance transactions. Among other things, these changes reduce or eliminate the obligation to give notice of interests in personal property when it is used in commercial finance transactions (as, e.g., collateral for a loan).

A principal purpose of notice-filing has been to deter the creation of secret liens, interests in property that are neither recorded nor otherwise readily observable. Secret liens are universally castigated as abhorrent.

Yet, two recent sets of legislative developments suggest that we may care much less about the problem of …

Secrets And Liens: Verification And Measurement In Commercial Finance Law, Jonathan C. Lipson

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This article argues that commercial finance law increasingly uses contract rules to displace property rules, especially as these rules pertain to verifying and measuring property interests. In this context, verification simply means confirming the existence of a property interest, such as a lien or security interest. Measurement means determining the relationships of various property interests to one another (i.e., the priority of interests).

Historically, commercial finance law – in particular the Uniform Commercial Code, which governs loans secured by personal property – provided that something would be treated as “property” only if its property character was fairly easy to discover. …

Debts, Divorce And Disarray In Bankruptcy, Margaret M. Mahoney

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The article addresses a point of intersection between federal bankruptcy law and state family law. Specifically, I deal with the various issues that arise when a former spouse to whom pre-existing marital debts were allocated at the time of divorce subsequently declares bankruptcy. A review of the legal literature reveals very little attention paid to the rights of the third-party marital creditor, the obligated spouse, and the other former spouse as to allocated debts, when the obligated spouse declares bankruptcy. While there is a significant body of work dealing generally with the treatment of divorce-related debts in bankruptcy, none of …

Corporate Cancellation Of Indebtedness Income And The Debt-Equity Distinction, Katherine Pratt

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This Article considers whether a corporation should have cancellation of indebtedness income (COD income) when it issues new stock or debt in exchange for its outstanding debt. It challenges the conventional wisdom about our current tax treatment of these exchanges and suggests alternative approaches. It also stresses the relationship between the COD income rules and the corporate interest deduction rules, and highlights the error correction function of the COD income rules. The current COD income rules applicable in debt-for-debt and stock-for-debt exchanges were enacted without regard for certain economic incentives they create. Consideration of these economic incentives may warrant a …

Contracting Out Of Bankruptcy: An Empirical Intervention, Jay L. Westbrook, Elizabeth Warren

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No abstract provided.

The Role Of History And Culture In Developing Bankruptcy And Insolvency Systems, Nathalie Martin

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No abstract provided.