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Bankruptcy’S Uneasy Shift To A Contract Paradigm, David A. Skeel Jr., George Triantis
Bankruptcy’S Uneasy Shift To A Contract Paradigm, David A. Skeel Jr., George Triantis
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The most dramatic development in twenty-first century bankruptcy practice has been the increasing use of contracts to shape the bankruptcy process. To explain the new contract paradigm—our principal objective in this Article-- we begin by examining the structure of current bankruptcy law. Although the Bankruptcy Code of 1978 has long been viewed as mandatory, its voting and cramdown rules, among others, invite considerable contracting. The emerging paradigm is asymmetric, however. While the Code and bankruptcy practice allow for ex post contracting, ex ante contracts are viewed with suspicion.
We next use contract theory to assess the two modes of contracting. …
Why Do Distressed Companies Choose Delaware? An Empirical Analysis Of Venue Choice In Bankruptcy , Kenneth M. Ayotte, David A. Skeel Jr.
Why Do Distressed Companies Choose Delaware? An Empirical Analysis Of Venue Choice In Bankruptcy , Kenneth M. Ayotte, David A. Skeel Jr.
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We analyze a sample of large Chapter 11 cases to determine which factors motivate the choice of filing in one court over another when a choice is available. We focus in particular on the Delaware court, which became the most popular venue for large corporations in the 1990s. We find no evidence of agency problems governing the venue choice or affecting the outcome of the bankruptcy process. Instead, firm characteristics and court characteristics, particularly a court's level of experience, are the most important factors. We find that court experience manifests itself in both a greater ability to reorganize marginal firms …