Law Commons^™

Employee Interests In Bankrupcy: Lessons From Enron, Lorie Johnson

Popular Media

Enron employees lost over $1 billion in retirement savings when the company failed and filed for bankruptcy protection. Many of these employees also lost their jobs. Enron employees were both visible and vocal about their losses, quickly obtaining the support of both the AFL-CIO and Jesse Jackson’s Rainbow/Push Coalition in their fight to get some redress for their losses. Since Enron was current on its payroll at the time of the bankruptcy filing, employees’ losses consisted of severance payments totaling $145 million and the losses associated with investments in Enron stock through their 401(k) accounts.

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

Scholarly Works

It is not the purpose of this study to argue for or against changes in the secured credit or insolvency law of Argentina or the U.S. The perpetual clash of interested noted by James Madison and the contemporary pressures of the global economy are likely to assure that these areas of law will be subject to continuing scrutiny in both countries. Instead, we first urge that the law governing the creation and enforcement of security devices and the way in which insolvency laws impact these devices be considered together as part of one system of financing. The power which secured …

Reorganizations And Stochastic Collateral Value, Royce De R. Barondes

Faculty Publications

Bebchuk and Fried propose using a series of auctions to implement a market-based methodology for valuing secured claims in a reorganization. This Article demonstrates their procedure can result in a secured creditor receiving more than its ex ante bargain, and that the probability distribution of possible collateral values can be relevant to fulfilling the ex ante bargain. This Article further develops and examines a refinement of the Bebchuk and Fried procedure that provides an approximate solution to the overcompensation of secured creditors. This refinement reconceptualizes collateral as comprising two components: (i) a call option on that property, exercisable at the …

The Effect Of Bankruptcy Upon A Firm Using Patents And Trademarks As Collateral, Lois R. Lupica

Faculty Publications

The Bankruptcy Code sets forth an orderly process for the distribution of a debtor-in-bankruptcy's assets. This process has the effect of altering many of the procedural and substantive rights and obligations of the debtor, as well as of the debtor's creditors. Parties asserting a property interest in assets of a debtor in bankruptcy, however, must rely on nonbankruptcy law to determine the nature and extent of their property interests. The most commonly asserted interest by creditors involved in a bankruptcy are security interests.

Bankruptcy Electronic Case Filing Workshop, Office Of Continuing Legal Education At The University Of Kentucky College Of Law

Continuing Legal Education Materials

Materials from the Bankruptcy Electronic Case Filing Workshop (C.M./E.C.F.: Case Management/Electronic Case Filing) held by UK/CLE in 2002.

Small Business Reorganization And The Sabre Proposals, Karen Gebbia

Publications

Many bankruptcy experts suspect that the substantial costs and hurdles of reorganizing under chapter 11 are especially burdensome for small businesses and may significantly impair small businesses' ability to reorganize and survive. It should not be surprising, then, that bankruptcy practitioners, scholars, and judges agonize over the treatment of small businesses in reorganization; conferences are organized to consider the particular problems of financially distressed small businesses; Congress singled out small businesses for attention in the 1994 Bankruptcy Code amendments; and the National Bankruptcy Review Commission recommended reforms applicable to small business reorganization cases.

Much of the debate concerning the treatment …

Why Warn? – The Worker Adjustment And Retraining Notification Act In Bankruptcy, Laura B. Bartell

Law Faculty Research Publications

The Worker Adjustment and Retraining Notification ("WARN") Ace was enacted by Congress in 1988 to provide limited protections to workers whose jobs are suddenly and permanently terminated. The WARN Act generally precludes an "employer" from ordering a "plant closing or mass layoff" until the expiration of a sixty-day period after giving written notice of such proposed action. Pursuant to legislative directive, the Department of Labor ("Department") promulgated a final rule in 1989 interpreting the provisions of the statutory language. Although neither the WARN Act itself nor the final rule makes any reference to bankrupt employers, in the preamble to the …

Can't Pay Your Debts, Mate? A Comparison Of The Australian And American Personal Bankruptcy Systems, 18 Bankr. Dev. J. 297 (2002), Paul B. Lewis

UIC Law Open Access Faculty Scholarship

No abstract provided.

Corporate Ownership Structure And The Evolution Of Bankruptcy Law: Lessons From The United Kingdom, John Armour, Brian R. Cheffins, David A. Skeel Jr.

All Faculty Scholarship

No abstract provided.

Limiting Liability Through Bankruptcy, G. Marcus Cole

Journal Articles

The purpose of this Article is to expose that function of bankruptcy law that distinguished it from English and Colonial insolvency law, and to determine the scope of and need for bankruptcy law to perform that function in contemporary society. I posit that the distinguishing character of bankruptcy law was, and continues to be, its ability to serve as a temporal asset partitioning device. By asset partition, I mean the ability of a structure to sequester the assets of an owner of an enterprise from the reach of the creditors of that enterprise, or the assets of the enterprise from …

Delaware Is Not A State: Are We Witnessing Jurisdictional Competition In Bankruptcy, G. Marcus Cole

Journal Articles

Over the last twelve years, the United States District Court for the District of Delaware has experienced exponential growth in the number of bankruptcy filings for large corporate debtors. This relatively recent rise in Delaware bankruptcy venue cannot, on its face, be explained by Delaware's eighty-five-year preeminence in the race for corporate charters, since the advantages most often postulated for Delaware's dominance in corporate law do not carry over to corporate bankruptcy. The state has limited influence over federal bankruptcy law and virtually no control over the selection of federal bankruptcy judges.

This rise of Delaware bankruptcy venue, or Delawarization …

Optimal Bankruptcy In A Non-Optimal World, Richard M. Hynes

Faculty Publications

Consumer bankruptcy insures individuals against misfortune. Like other forms of insurance, bankruptcy reduces an individual's incentive to guard against misfortune and provides her with an incentive to overstate her need for relief. The "first-best," or optimal, bankruptcy system, like the first-best tax or public assistance system, solves these moral hazards without any loss of efficiency. In bankruptcy, this first-best approach would deny relief to debtors responsible for their own distress and reduce the deserving debtors' obligations to an amount commensurate with their ability to pay. While the Bankruptcy Code tries (in part) to follow this first-best approach, such a utopian …

"Retail Choice" Is Coming: Have You Hugged Your Utilities Lawyer Today? (Part I), Nancy B. Rapoport, Jeffrey D. Van Niel

Scholarly Works

This part of the article provides a primer on the history of utilities regulation. (Part II provides a discussion on the intersection of utilities law and bankruptcy law, pre-BAPCPA.)

Multidisciplinary Practice After In Re Enron: Should The Debate On Mdp Change At All?, Nancy B. Rapoport

Scholarly Works

No abstract provided.

"Retail Choice" Is Coming: Have You Hugged Your Utilities Lawyer Today? (Part Ii), Nancy B. Rapoport, Jeffrey D. Van Niel

Scholarly Works

This part of the article provides a discussion on the intersection of utilities law and bankruptcy law, pre-BAPCPA. (Part I provides a primer on the history of utilities regulation.)

Revised Article 9, The Proposed Bankruptcy Code Amendments And Securitizing Debtors And Their Creditors, Lois R. Lupica

Faculty Publications

The new provisions in Revised Article 9 both reflects the drafters’ decision to enhance secured creditors’ rights, but also includes myriad provisions designed to facilitate securitization transactions. Because bankruptcy law looks to state law (specifically Article 9) to determine the rights of creditors and transferees with respect to personal property, changes to Article 9 are in effect, changes to bankruptcy law. The question raised by the changes to Article 9 is whether these changes are consistent with our historical understanding of bankruptcy policy.

Enron And The Dark Side Of Shareholder Value, William W. Bratton

All Faculty Scholarship

No abstract provided.

After Orange County: Reforming California Municipal Bankruptcy Law, Frederick Tung

Faculty Scholarship

Because of federal constitutional concerns, a municipal entity may resort to federal bankruptcy protection only with the authorization of its state. Federal law requires that a municipality be "specifically authorized" under state law to file for bankruptcy protection. Existing California law provides fairly broad authorization for its municipalities, but the statute is in need of both technical and substantive revision. After discussing constitutional concerns and surveying other states' approaches to municipal bankruptcy authorization, Professor Tung recommends a system of discretionary access, in which the governor holds discretionary power to approve, disapprove, or condition a municipality's access to bankruptcy.

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

All Faculty Scholarship

No abstract provided.

Why Are Delaware And New York Bankruptcy Reorganizations Failing?, Lynn M. Lopucki, Joseph W. Doherty

UF Law Faculty Publications

Why are Delaware and New York Bankruptcy Reorganizations Failing?

China, Nicholas C. Howson, Lester Ross, Donald Clarke

Book Chapters

The mere notion of bankruptcy, liquidation or reorganisation of industrial enterprises was long considered anathema in the People's Republic of China (PRC or China), and directly contrary to the underlying logic of a centrally planned, state-owned economy and industrial system. The state's reluctance to allow bankruptcies was rooted in the ideology of the governing Communist Party but also reflects fiscal constraints with respect to payments to unemployed workers and the recapitalisation of state-owned commercial banks forced to write off loans as bad debts. However, such notions have gained wider acceptance concurrent with:

• China's ongoing transformation to a socialist market economy; …

What Enron Means For The Management And Control Of The Modern Business Corporation: Some Initial Reflections, Jeffrey N. Gordon

Faculty Scholarship

The Enron case plays on many different dimensions, but its prominence is not merely part of popular culture's obsession with scandal du jour. Rather, the Enron situation challenges some of the core beliefs and practices that have underpinned the academic analysis of corporate law and governance, including mergers and acquisitions, since the 1980s. These amount to an interlocking set of institutions that constitute "shareholder capitalism," American-style, 2001, that we have been aggressively promoting throughout the world. We have come to rely on a particular set of assumptions about the connection between stock market prices and underlying economic realities; the reliability …

Muddy Rules For Securitization Transactions, Edward J. Janger

Faculty Scholarship

No abstract provided.

Fixing Florida's Execution Lien Law Part Two: Florida's New Judgment Lien On Personal Property, Jeffrey Davis

UF Law Faculty Publications

Under both the prior and current laws, a creditor seeking to satisfy a judgment out of property of the judgment debtor obtains a writ of execution from the clerk of the court that issued the judgment and then delivers the writ to a sheriff in one of Florida's sixty-seven counties. The writ commands the sheriff to levy on property of the debtor until the amount stated in the writ is satisfied. Under the prior law, delivery of the writ to the sheriff not only initiated the execution process, but under the seminal case of Love v. Williams, it also …