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Articles 1 - 30 of 31
Full-Text Articles in Law
Silencing Litigation Through Bankruptcy, Pamela Foohey, Christopher K. Odinet
Silencing Litigation Through Bankruptcy, Pamela Foohey, Christopher K. Odinet
Articles
Bankruptcy is being used as a tool for silencing survivors and their families. When faced with claims from multiple plaintiffs related to the same wrongful conduct that can financially or operationally crush the defendant over the long term—a phenomenon we identify as onslaught litigation—defendants harness bankruptcy’s reorganization process to draw together those who allege harm and pressure them into a swift, universal settlement. In doing so, they use the bankruptcy system to deprive survivors of their voice and the public of the truth. This Article identifies this phenomenon and argues that it is time to rein in this destructive use …
Third-Party Releases Under The Bankruptcy Code After Purdue Pharma, Jeanne L. Schroeder, David G. Carlson
Third-Party Releases Under The Bankruptcy Code After Purdue Pharma, Jeanne L. Schroeder, David G. Carlson
Articles
The biggest bankruptcy case ever (as measured by unsecured claims against a debtor-in-possession) is In re Purdue Pharma, LLC. The bankruptcy court affirmed a plan discharging the Sackler family (equity owners and often officers of Purdue) of all “derivative” claims that belonged to the debtor-in-possession. The settlement was bought for a substantial sum payable over time by the Sacklers. A debtor-in-possession is the sole owner of a derivative claim and has the power to bind all the creditors to a settlement. Under the Bankruptcy Code, a plan discharging derivative claims is confirmable. In fact, as we will, show, a great …
The Housing Bubble And Consumer Bankruptcy (Parts I And Ii), David G. Carlson
The Housing Bubble And Consumer Bankruptcy (Parts I And Ii), David G. Carlson
Articles
During the COVID pandemic housing prices have soared. Consumers who have filed for bankruptcy are now looking at enormous realized and unrealized capital gains. This article assesses the chances that these consumer debtors can keep these gains out of the hands of their creditors. Part I of this two-part article addresses chapter 7 issues, which concern lien stripping, abandonment, and monetary exemptions. It also addresses lien stripping in chapter 13 cases. Part II will address whether a chapter 13 debtor must surrender appreciation value to the chapter 13 trustee or to a trustee in a converted chapter 7 case.
Generalized Creditors And Particularized Creditors: Against A Unified Theory Of Standing In Bankruptcy, David G. Carlson, Jeanne L. Schroeder
Generalized Creditors And Particularized Creditors: Against A Unified Theory Of Standing In Bankruptcy, David G. Carlson, Jeanne L. Schroeder
Articles
Courts have struggled toward a unified theory to explain when the trustee has exclusive jurisdiction to sue a third party for harms done to a bankrupt debtor, and when creditors have exclusive jurisdiction to sue the third party. Courts have proclaimed that when every creditor can sue the third party, then none of them can, and the right belongs solely to the trustee. Creditor rights are “generalized.” If only a proper subset of creditors can sue the third party, then the trustee is not able to subrogate to the subset. Such creditors are “particularized.” This paper proclaims the test a …
Portraits Of Bankruptcy Filers, Pamela Foohey, Robert M. Lawless, Deborah Thorne
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 …
Steering Loan Modifications Post-Pandemic, Pamela Foohey, Dalie Jimenez, Christopher K. Odinet
Steering Loan Modifications Post-Pandemic, Pamela Foohey, Dalie Jimenez, Christopher K. Odinet
Articles
As part of federal and state relief programs created during the COVID-19 pandemic, many American households received pauses on their largest debts, particularly on mortgages and student loans. Others may have come to agreements with their lenders, likewise pausing or altering payment on other debts, such as auto loans and credit cards. This relief allowed households to allocate their savings and income to necessary expenses, like groceries, utilities, and medicine. But forbearance does not equal forgiveness. At the end of the various relief periods and moratoria, people will have to resume paying all their debts, the amounts of which may …
Constructive Trusts And Fraudulent Transfers: When Worlds Collide, David G. Carlson
Constructive Trusts And Fraudulent Transfers: When Worlds Collide, David G. Carlson
Articles
When Ponzi schemes collapse and enter into bankruptcy liquidation, bankruptcy trustees assume that conveyances made by the debtor for no consideration are fraudulent conveyances. This Article argues that they are not. Virtually all the assets held by a Ponzi scheme are held in constructive trust for the victims of the fraud. If victims of the fraud can trace the proceeds of their investments into property transferred to a third party, the third party holds the asset transferred in trust for the relevant victim. When a bankruptcy trustee characterizes the asset as a fraudulently conveyed asset, the trustee expropriates the asset …
Cars In Chapter 13: Does Negative Equity Destroy The Jurisdiction Of The Hanging Paragraph, David G. Carlson
Cars In Chapter 13: Does Negative Equity Destroy The Jurisdiction Of The Hanging Paragraph, David G. Carlson
Articles
Roughly speaking, the “hanging paragraph” to Bankruptcy Code 1325(a), enacted in 2005, requires that a debtor pay the full debt on any automobile acquired within 910 days before bankruptcy – a boon for car financiers. Prior to 2005 the debtor had to pay only the appraised value of the car – usually a lesser amount. But the privilege bestowed on car financiers by the hanging paragraph depends on the financier providing “purchase money” credit. About one-third of the time, however, the financier advances funds to repay a prior car loan as part of the “trade-in” of an old vehicle for …
The Role Of Valuation In Federal Bankruptcy Exemption Process: The Supreme Court Reads Schedule C, David G. Carlson
The Role Of Valuation In Federal Bankruptcy Exemption Process: The Supreme Court Reads Schedule C, David G. Carlson
Articles
In Taylor v. Freeland & Kronz, a debtor claimed a law suit was exempt. The bankruptcy trustee failed to object within the required period. Later, the law suit realized an amount that far exceeded the monetary limit to which the debtor was entitled. The Supreme Court permitted the debtor to keep all of the proceeds, even beyond the statutory limit, claiming that a deadline was a deadline. Recently, in Schwab v. Reilly, the Supreme Court overruled Taylor, holding that a claim to a monetarily limited item can only exempt the monetary limit. The Court tries and fails to "reconcile" these …
Modified Plans Of Reorganization And The Basic Chapter 13 Bargain, David G. Carlson
Modified Plans Of Reorganization And The Basic Chapter 13 Bargain, David G. Carlson
Articles
A very large number of chapter 13 plans are confirmed each year. Unlike chapter 11 plans (for non-individuals), these plans may be revised after confirmation. The modification provisions of the Bankruptcy Code, however, give very little guidance as to what constitutes a permissible modification. In contrast, confirmation of the original plan is very carefully governed. This article theorizes that modification must honor the basic chapter 13 bargain. According to this bargain, the debtor is entitled to the bankruptcy estate and the creditors are entitled to net surplus income. The article assesses whether the diffuse and disorganized caselaw of modification adheres …
The Chapter 13 Estate And Its Discontents, David G. Carlson
The Chapter 13 Estate And Its Discontents, David G. Carlson
Articles
Thirty years after the enactment of the Bankruptcy Code, the courts have yet to agree on a theory of the bankruptcy estate in Chapter 13 cases. This is not the fault of the courts. The Bankruptcy Code is contradictory as to the composition of the chapter 13 estate. This article selects one of four possible theories and defends it as the one that does the least violence to the plain meaning of the Bankruptcy Code.
This theory is referred to in this article as the "Divestment Theory," because it holds that, upon confirmation of a chapter 13 plan, the debtor …
Cars And Homes In Chapter 13 After The 2005 Amendments To The Bankruptcy Code, David G. Carlson
Cars And Homes In Chapter 13 After The 2005 Amendments To The Bankruptcy Code, David G. Carlson
Articles
No abstract provided.
Ethical Issues In Asbestos Litigation, Lester Brickman
Ethical Issues In Asbestos Litigation, Lester Brickman
Articles
Asbestos litigation has given rise to over 50,000,000 claims against 8400 former producers, distributors, installers and sellers of asbestos-containing products. To date, 850,000 claimants have sought compensation, costing businesses and insurance companies over $70 billion and resulting in more than 70 bankruptcies. Over 100,000 deaths are attributable to asbestos exposure with an additional 40,000 deaths anticipated over the next 30 years. Despite the significance of the ethical issues generated by the processes of acquiring, pressing and settling the most massive litigation in history, the legal literature is substantially devoid of any such discussion. One possible reason for this paucity of …
Bankruptcy's Acephalous Moment: Postpetition Transfers Under The Bankruptcy Code, David G. Carlson
Bankruptcy's Acephalous Moment: Postpetition Transfers Under The Bankruptcy Code, David G. Carlson
Articles
No abstract provided.
Indemnity, Liability, Insolvency, David G. Carlson
Indemnity, Liability, Insolvency, David G. Carlson
Articles
Suppose A has a claim against B. B has a claim over against C. B, however, is insolvent and has not actually paid A. B's only asset is, in fact, B v C. To what extent can C claim that B v C is valueless - that B was not damaged because B was too broke to pay A?
This paper argues that the fundamental legal distinction between indemnity and liability is beginning to dissolve, because B can always pay A (and thereby give value to B v C) by borrowing the amount B owes and using B v C …
The Logical Structure Of Fraudulent Transfers And Equitable Subordination, David G. Carlson
The Logical Structure Of Fraudulent Transfers And Equitable Subordination, David G. Carlson
Articles
No abstract provided.
Avoidance Theory According To Steve Nickles, David G. Carlson
Avoidance Theory According To Steve Nickles, David G. Carlson
Articles
No abstract provided.
The Truth About The New Value Exception To Bankruptcy’S Absolute Priority Rule, David G. Carlson, Jack F. Williams
The Truth About The New Value Exception To Bankruptcy’S Absolute Priority Rule, David G. Carlson, Jack F. Williams
Articles
No abstract provided.
Bankruptcy's Organizing Principle, David G. Carlson
Junior Secured Creditors And The Automatic Stay, David G. Carlson
Junior Secured Creditors And The Automatic Stay, David G. Carlson
Articles
No abstract provided.
Rake's Progress: Cure And Reinstatement Of Secured Claims In Bankruptcy Reorganization, David G. Carlson
Rake's Progress: Cure And Reinstatement Of Secured Claims In Bankruptcy Reorganization, David G. Carlson
Articles
No abstract provided.
Security Interests On Exempt Property After The 1994 Amendments To The Bankruptcy Code, David G. Carlson
Security Interests On Exempt Property After The 1994 Amendments To The Bankruptcy Code, David G. Carlson
Articles
No abstract provided.
Redemption And Reinstatement In Chapter 7 Cases, David G. Carlson
Redemption And Reinstatement In Chapter 7 Cases, David G. Carlson
Articles
No abstract provided.
Car Wars: Valuation Standards In Chapter 13 Bankruptcy Cases, David G. Carlson
Car Wars: Valuation Standards In Chapter 13 Bankruptcy Cases, David G. Carlson
Articles
No abstract provided.
Adequate Protection Payments And The Surrender Of Cash Collateral In Chapter 11 Reorganization, David G. Carlson
Adequate Protection Payments And The Surrender Of Cash Collateral In Chapter 11 Reorganization, David G. Carlson
Articles
No abstract provided.
Claims & Opinions An Exchange Of Views: Game Theory And Bankruptcy Reorganizations, David G. Carlson
Claims & Opinions An Exchange Of Views: Game Theory And Bankruptcy Reorganizations, David G. Carlson
Articles
No abstract provided.
Secured Creditors And The Eely Character Of Bankruptcy Valuations, David G. Carlson
Secured Creditors And The Eely Character Of Bankruptcy Valuations, David G. Carlson
Articles
No abstract provided.
Oversecured Creditors Under Bankruptcy Code Section 506(B): The Limits Of Postpetition Interest, Attorneys' Fees, And Collection Expenses, David G. Carlson
Oversecured Creditors Under Bankruptcy Code Section 506(B): The Limits Of Postpetition Interest, Attorneys' Fees, And Collection Expenses, David G. Carlson
Articles
No abstract provided.
Unsecured Claims Under Bankruptcy Code Sections 506(A) And 1111(B): Second Looks At Judicial Valuations Of Collateral, David G. Carlson
Unsecured Claims Under Bankruptcy Code Sections 506(A) And 1111(B): Second Looks At Judicial Valuations Of Collateral, David G. Carlson
Articles
No abstract provided.
Successor Liability In Bankruptcy: Some Unifying Themes Of Intertemporal Creditor Priorities Created By Running Covenants, Products Liability, And Toxic-Waste Cleanup, David G. Carlson
Articles
No abstract provided.