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Full-Text Articles in Law

Adverse Domination, Statutes Of Limitations And The In Pari Delicto Defense - Application In Cases Involving Claims Of Accounting Malpractice And Corporate Fraud, Laurence A. Steckman Esq., Adam J. Rader Esq. Jan 2021

Adverse Domination, Statutes Of Limitations And The In Pari Delicto Defense - Application In Cases Involving Claims Of Accounting Malpractice And Corporate Fraud, Laurence A. Steckman Esq., Adam J. Rader Esq.

Touro Law Review

No abstract provided.


Cacs And Doorknobs, Anna Gelpern, Jeromin Zettelmeyer Oct 2019

Cacs And Doorknobs, Anna Gelpern, Jeromin Zettelmeyer

Georgetown Law Faculty Publications and Other Works

In response to debt crises, policy makers often feature Collective Action Clauses (CACs) in sovereign bonds among the pillars of international financial architecture. However, the content of official pronouncements about CACs suggests that CACs are more like doorknobs: a process tool with limited impact on the incidence or ultimate outcome of a debt restructuring. We ask whether CACs are welfare improving and, if so, whether they are pillars or doorknobs. The history of CACs in corporate debt suggests that CACs can be good, bad or unimportant depending on their vulnerability to abuse and the available alternatives, including bankruptcy and debt ...


Are Charter Schools The Second Coming Of Enron?: An Examination Of The Gatekeepers That Protect Against Dangerous Related-Party Transactions In The Charter School Sectors, Preston C. Green Iii, Bruce D. Baker, Joseph O. Oluwole Jan 2018

Are Charter Schools The Second Coming Of Enron?: An Examination Of The Gatekeepers That Protect Against Dangerous Related-Party Transactions In The Charter School Sectors, Preston C. Green Iii, Bruce D. Baker, Joseph O. Oluwole

Indiana Law Journal

INTRODUCTION

OVERVIEW OF ENRON

A. ENRON AND DEREGULATION

B. THE LJM SPES

C. ENRON’S COLLAPSE

II: ENRON’S GATEKEEPER PROBLEMS

A. ARTHUR ANDERSEN

B. INDEPENDENT ANALYSTS

C. CREDIT RATING AGENCIES

D. ENRON’S BOARD OF DIRECTORS

E. SECURITIES AND EXCHANGE COMMISSION (SEC)

III: CHARTER SCHOOLS AND RELATED-PARTY TRANSACTIONS

A. CHARTER SCHOOL DEREGULATION AND PRIVATE INVESTORS

B. EXAMPLES OF ENRON-LIKE RELATED-PARTY TRANSACTIONS

1. IMAGINE SCHOOLS

2. IVY ACADEMIA CHARTER SCHOOL

3. AMERICAN INDIAN MODEL CHARTER SCHOOLS

4. GRAND TRAVERSE ACADEMY

5. PENNSYLVANIA CYBER CHARTER SCHOOL

C. THE FEDERAL GOVERNMENT, RELATED-PARTY TRANSACTIONS, AND THE NEED FOR STRONG GATEKEEPING

IV: CHARTER SCHOOL ...


The New Bond Workouts, William W. Bratton, Adam J. Levitin Jan 2018

The New Bond Workouts, William W. Bratton, Adam J. Levitin

Faculty Scholarship at Penn Law

Bond workouts are a famously dysfunctional method of debt restructuring, ridden with opportunistic and coercive behavior by bondholders and bond issuers. Yet since 2008 bond workouts have quietly started to work. A cognizable portion of the restructuring market has shifted from bankruptcy court to out-of-court workouts by way of exchange offers made only to large institutional investors. The new workouts feature a battery of strong-arm tactics by bond issuers, and aggrieved bondholders have complained in court. The result has been a new, broad reading of the primary law governing workouts, section 316(b) of the Trust Indenture Act of 1939 ...


Incentive For Sale: § 503(C) And Asset Sales Within The Southern District Of New York, Christopher Scavone Jan 2016

Incentive For Sale: § 503(C) And Asset Sales Within The Southern District Of New York, Christopher Scavone

Washington University Journal of Law & Policy

This Note examines the recent shift towards rejecting proposed Key Employee Incentive Plans within the Southern District of New York as highlighted by the Hawker and Residential Capital decisions, and why the current standard is inadequate to address the special concerns that arose in those two cases. Scavone first examines the historical basis for executive compensation in bankruptcy, the formulation of the 2005 BAPCPA amendments, and the cases that followed. Scavone then presents the Hawker and Residential Capital cases, followed by an analysis of why the application of § 503(c) as it currently stands was inadequate for the proposed asset ...


Regulating Public Offerings Of Truly New Securities: First Principles, Merritt B. Fox Jan 2016

Regulating Public Offerings Of Truly New Securities: First Principles, Merritt B. Fox

Faculty Scholarship

The public offering of truly new securities involves purchases by investors in sufficient number and in small enough blocks that each purchaser’s shares can reasonably be expected to be freely tradable in a secondary market that did not exist before the offering. Increasing the ability of small and medium-sized enterprises (SMEs) to make such offerings has been the subject of much recent discussion.

At the time that a firm initially contemplates such an offering, unusually large information asymmetries exist between its insiders and potential investors. These can lead to severe adverse-selection problems that prevent a substantial portion of worthy ...


Sovereign Debt: Now What?, Anna Gelpern Jan 2016

Sovereign Debt: Now What?, Anna Gelpern

Georgetown Law Faculty Publications and Other Works

The sovereign debt restructuring regime looks like it is coming apart. Changing patterns of capital flows, old creditors’ weakening commitment to past practices, and other stakeholders’ inability to take over, or coalesce behind a viable alternative, have challenged the regime from the moment it took shape in the mid-1990s. By 2016, its survival cannot be taken for granted. Crises in Argentina, Greece, and Ukraine since 2010 exposed the regime’s perennial failures and new shortcomings. Until an alternative emerges, there may be messier, more protracted restructurings, more demands on public resources, and more pressure on national courts to intervene in ...


Introduction To Institutional Investor Activism: Hedge Funds And Private Equity, Economics And Regulation, William W. Bratton, Joseph A. Mccahery Jan 2015

Introduction To Institutional Investor Activism: Hedge Funds And Private Equity, Economics And Regulation, William W. Bratton, Joseph A. Mccahery

Faculty Scholarship at Penn Law

The increase in institutional ownership of recent decades has been accompanied by an enhanced role played by institutions in monitoring companies’ corporate governance behaviour. Activist hedge funds and private equity firms have achieved a degree of success in actively shaping the business plans of target firms. They may be characterized as pursuing a common goal – in the words used in the OECD Steering Group on Corporate Governance, both seek ‘to increase the market value of their pooled capital through active engagement with individual public companies. This engagement may include demands for changes in management, the composition of the board, dividend ...


Ponzi Schemes In Bankruptcy, Honorable Dorothy T. Eisenberg, Nicholas W. Quesenberry Oct 2014

Ponzi Schemes In Bankruptcy, Honorable Dorothy T. Eisenberg, Nicholas W. Quesenberry

Touro Law Review

No abstract provided.


Secured Credit And Insolvency Law In Argentina And The U.S.: Gaining Insight From A Comparative Perspective, Guillermo A. Moglia Claps, Julian B. Mcdonnell Oct 2014

Secured Credit And Insolvency Law In Argentina And The U.S.: Gaining Insight From A Comparative Perspective, Guillermo A. Moglia Claps, Julian B. Mcdonnell

Georgia Journal of International & Comparative Law

No abstract provided.


Synthetic Cdos, Conflicts Of Interest, And Securities Fraud, Jennifer O'Hare Jan 2014

Synthetic Cdos, Conflicts Of Interest, And Securities Fraud, Jennifer O'Hare

University of Richmond Law Review

No abstract provided.


Rollover Risk: Ideating A U.S. Debt Default, Steven L. Schwarcz Jan 2014

Rollover Risk: Ideating A U.S. Debt Default, Steven L. Schwarcz

Faculty Scholarship

This article examines how a U.S. debt default might occur, how it could be avoided, its potential consequences if not avoided, and how those consequences could be mitigated. To that end, the article differentiates defaults caused by insolvency from defaults caused by illiquidity. The latter, which are potentiated by rollover risk (the risk that the government will be temporarily unable to borrow sufficient funds to repay its maturing debt), are not only plausible but have occurred in the past. Moreover, the ongoing controversy over the federal debt ceiling and the rise of the shadow-banking system make these types of ...


A People’S History Of Collective Action Clauses, Mark C. Weidemaier, Mitu Gulati Jan 2014

A People’S History Of Collective Action Clauses, Mark C. Weidemaier, Mitu Gulati

Faculty Scholarship

For two decades, collective action clauses (CACs) have been part of the official-sector response to sovereign debt crisis, justified by claims that these clauses can help prevent bailouts and shift the burden of restructuring onto the private sector. Reform efforts in the 1990s and 2000s focused on CACs. So do efforts in the Eurozone today. CACs have even been suggested as the cure for the US municipal bond market. But bonds without CACs are still issued in major markets, so reformers feel obliged to explain why they know better. Over time, a narrative has emerged to justify pro-CAC reforms. It ...


Rolling Back The Repo Safe Harbors, Edward R. Morrison, Mark J. Roe, Christopher S. Sontchi Jan 2014

Rolling Back The Repo Safe Harbors, Edward R. Morrison, Mark J. Roe, Christopher S. Sontchi

Faculty Scholarship

Recent decades have seen substantial expansion in exemptions from the Bankruptcy Code's normal operation for repurchase agreements. These repos, which are equivalent to very short-term (often one-day) secured loans, are exempt from core bankruptcy rules such as the automatic stay that enjoins debt collection, rules against prebankruptcy fraudulent transfers, and rules against eve-of-bankruptcy preferential payment to favored creditors over other creditors. While these exemptions can be justified for United States Treasury securities and similarly liquid obligations backed by the full faith and credit of the United States government, they are not justified for mortgage-backed securities and other securities that ...


Securities Class Actions And Bankrupt Companies, James J. Park Feb 2013

Securities Class Actions And Bankrupt Companies, James J. Park

Michigan Law Review

Securities class actions are often criticized as wasteful strike suits that target temporary fluctuations in the stock prices of otherwise healthy companies. The securities class actions brought by investors of Enron and WorldCom, companies that fell into bankruptcy in the wake of fraud, resulted in the recovery of billions of dollars in permanent shareholder losses and provide a powerful counterexample to this critique. An issuer's bankruptcy may affect how judges and parties perceive securities class actions and their merits, yet little is known about the subset of cases where the company is bankrupt. This is the first extensive empirical ...


Ring-Fencing, Steven L. Schwarcz Jan 2013

Ring-Fencing, Steven L. Schwarcz

Faculty Scholarship

“Ring-fencing” is often touted as a regulatory solution to problems in banking, finance, public utilities, and insurance. However, both the precise meaning of ring-fencing, as well as the nature of the problems that ring-fencing regulation purports to solve, are ill defined. This article examines the functions and conceptual foundations of ring-fencing. In a regulatory context, the term can best be understood as legally deconstructing a firm in order to more optimally reallocate and reduce risk. So utilized, ring-fencing can help to protect public-benefit activities performed by private-sector firms, as well as to mitigate systemic risk and the too-big-to-fail problem inherent ...


Mandatory Class Action Lawsuits As A Restructuring Technique, Bryant B. Edwards, Jeffrey A. Herbst, Selina K. Hewitt Nov 2012

Mandatory Class Action Lawsuits As A Restructuring Technique, Bryant B. Edwards, Jeffrey A. Herbst, Selina K. Hewitt

Pepperdine Law Review

No abstract provided.


The Uncertainty Of “True Sale” Analysis In Originator Bankruptcy, Stephen P. Hoffman Jan 2012

The Uncertainty Of “True Sale” Analysis In Originator Bankruptcy, Stephen P. Hoffman

Stephen P. Hoffman

While much of law is complex or unclear, it is unusual for a judge to comment that a legal doctrine is so unsettled that courts “could flip a coin” to decide an issue. Unfortunately for practitioners, determining what constitutes a “true sale” for bankruptcy purposes is such an issue. Add to this the recent novel and innovative processes of structured finance and asset-backed securitization, and you have the stuff of law students’—and corporate counsels’—nightmares. As a result, courts and legislatures need to provide clarity in this area so that originators can safely structure investments and transactions, not only ...


Federal Interventions In Private Enterprise In The United States: Their Genesis In And Effects On Corporate Finance Instruments And Transactions, Joan Heminway Oct 2011

Federal Interventions In Private Enterprise In The United States: Their Genesis In And Effects On Corporate Finance Instruments And Transactions, Joan Heminway

Joan M Heminway

In response to U.S. corporate failures involved in the current global financial crisis, traditional corporate finance vehicles and tools were widely used in new ways and for new purposes. Of course, one object of the U.S. government’s investment and intervention in, and exercise of influence over, private enterprise during the crisis was to provide for or ensure the provision of adequate capital funding. But its investment, intervention, and influence also represented a new way to oversee and otherwise regulate key business enterprises in the financial services and automotive sectors. This Article reviews certain aspects of the use ...


Making Sense Of The New Financial Deal, David A. Skeel Jr. Apr 2011

Making Sense Of The New Financial Deal, David A. Skeel Jr.

Faculty Scholarship at Penn Law

In this Essay, I assess the enactment and implications of the Dodd-Frank Act, Congress’s response to the 2008 financial crisis. To set the stage, I begin by very briefly reviewing the causes of the crisis. I then argue that the legislation has two very clear objectives. The first is to limit the risk of the shadow banking system by more carefully regulating the key instruments and institutions of contemporary finance. The second objective is to limit the damage in the event one of these giant institutions fails. While the new regulation of the instruments of contemporary finance—including clearing ...


Predatory Structured Finance, Christopher L. Peterson Sep 2006

Predatory Structured Finance, Christopher L. Peterson

ExpressO

Predatory lending is a real, pervasive, and destructive problem as demonstrated by record settlements, jury awards, media exposes, and a large body of empirical scholarship. Currently the national debate over predatory mortgage lending is shifting to the controversial question of who should bear liability for predatory lending practices. In today’s subprime mortgage market, originators and brokers quickly assign home loans through a complex and opaque series of transactions involving as many as a dozen different strategically organized companies. Loans are typically transferred into large pools, and then income from those loans is “structured” to appeal to different types of ...


Preference Determinations Concerning Bankruptcy Reform Act Of 1978 And Securities Act Of 1933, Securities And Exchange Act Of 1934, And Commodity Exchange Act, J. B. Grossman Jul 2005

Preference Determinations Concerning Bankruptcy Reform Act Of 1978 And Securities Act Of 1933, Securities And Exchange Act Of 1934, And Commodity Exchange Act, J. B. Grossman

University of Arkansas at Little Rock Law Review

No abstract provided.


What Makes Asset Securitization "Inefficient"?, Kenji Yamazaki May 2005

What Makes Asset Securitization "Inefficient"?, Kenji Yamazaki

ExpressO

Despite the damage caused by the recent Enron scandal , the asset securitization market has been vibrant and has become a popular financing alternative . A number of academics emphasize its merits and suggest that it is a more favorable way of financing, and Congress’s proposal to make sales of asset in securitization immune from characterization as secured transactions under the Bankruptcy Reform Act of 2001 (the “Reform Act”) almost materialized when the Enron scandal hit the scene. Conversely, there have been accusations that securitization is not a legitimate way of financing because, for example, it fosters fraudulent transactions.

Why are ...


Closing A Bankruptcy Loop-Hole Or Impairing A Debtor's Fresh Start? Sarbanes-Oxley Creates A New Exception To Discharge, Lucian Murley Jan 2003

Closing A Bankruptcy Loop-Hole Or Impairing A Debtor's Fresh Start? Sarbanes-Oxley Creates A New Exception To Discharge, Lucian Murley

Kentucky Law Journal

No abstract provided.


The Rise Of State Bankruptcy-Directed Legislation, Ronald J. Mann Jan 2003

The Rise Of State Bankruptcy-Directed Legislation, Ronald J. Mann

Faculty Scholarship

This is a paper for a conference at Cardozo Law School on the relation between securitization and secured credit. Concerns about securitization have been focused by decisions of various States to take the lead in attempting to decide how those issues will be resolved in bankruptcy proceedings. In this paper I step back from that debate to ask a more fundamental question: who is to decide the appropriate policy response to those issues? On the one hand, Congress could decide those questions in the exercise of its exclusive constitutional power to enact bankruptcy laws. Or, if it chose to do ...


Venture Capital On The Downside: Preferred Stock And Corporate Control, William W. Bratton Mar 2002

Venture Capital On The Downside: Preferred Stock And Corporate Control, William W. Bratton

Michigan Law Review

When stock indices drop precipitously, when the startup companies fizzle out, and when it stops raining money on places like Wall Street and Silicon Valley, attention turns to downside contracting. Law and business lawyers, sitting in the back seat as mere facilitators on the upside, move up to the front and sometimes even take the wheel. The job is the same on both the upside and downside: to maximize the value of going concern assets. But what comes easily on the upside can be dirty work on the down, where assets need to be separated from dysfunctional teams of business ...


The Use Of Intellectual Property As Collateral: Gap In The Perfection Of A Security Interest, Sofia Benammar Jan 2000

The Use Of Intellectual Property As Collateral: Gap In The Perfection Of A Security Interest, Sofia Benammar

LLM Theses and Essays

The purpose of the present thesis is to let French lawyers know which step they need to take in order to best assist their client in securing a more solid investment. Lenders want to be protected. Lenders want to be sure that they can use the intellectual property rights in a commercial environment free from superior claims by third parties. In other words, a lender who provides a large loan to a borrower wants to know how and where its security interest will be perfected and what is the best way for him to have priority over other claims. This ...


Commercial Arbitration In The U.S.: The Arbitrability Of Disputes Arising From Statute-Based Claims, Sylvie Frankignoul Jan 1999

Commercial Arbitration In The U.S.: The Arbitrability Of Disputes Arising From Statute-Based Claims, Sylvie Frankignoul

LLM Theses and Essays

A leading contemporary expert in arbitration has explained: "The concept of arbitrability determines the point at which the experience of contractual freedom ends and the public mission of adjudication begins. In effect, it establishes a dividing line between the transactional pursuit of private rights and courts' role as custodians and interpreters of the public interest." 1 A major part of the arbitrability doctrine deals with the kind of claims that can fall within the scope of agreements for private dispute resolution. Arbitration clauses are an integral part of the parties' transactions. Nevertheless, the American judiciary historically has refused to enforce ...


Maintenance Of Market Strategies In Futures Broker Insolvencies: Futures Position Transfers From Troubled Firms, Andrea M. Corcoran, Susan C. Ervin Jun 1987

Maintenance Of Market Strategies In Futures Broker Insolvencies: Futures Position Transfers From Troubled Firms, Andrea M. Corcoran, Susan C. Ervin

Washington and Lee Law Review

No abstract provided.


The Continuing Puzzle Of Secured Debt, Alan Schwartz Oct 1984

The Continuing Puzzle Of Secured Debt, Alan Schwartz

Vanderbilt Law Review

In 1981, I wrote an article showing that no good answer had been given to the question why corporations issue some debt on a secured basis and other debt on an unsecured basis.' This showing had normative implications because claims that the institution of personal property security is efficient or otherwise desirable must be impeached if the actual purposes that security serves are unknown. Consequently, the law's favorable treatment of secured debt-for example, giving it first place in bankruptcy distributions--is without plausible support. My article did not advocate repealing the privileges attached to secured debt, however, because then--current knowledge ...