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Full-Text Articles in Law
The Uncertainty Of “True Sale” Analysis In Originator Bankruptcy, Stephen P. Hoffman
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 for the …
Cleaning Up Bankruptcy: Limiting The Dischargeability Of Environmental Cleanup Costs, Sonali P. Chitre
Cleaning Up Bankruptcy: Limiting The Dischargeability Of Environmental Cleanup Costs, Sonali P. Chitre
Sonali P Chitre
This article reconciles the joint aims of environmental and bankruptcy law after Judge Posner’s myopic opinion in the Seventh Circuit’s resolution of U.S. v. Apex Oil. These two areas of law represent alternative means to the same end—the equitable distribution of limited resources—and share equity’s traditional emphasis of function over form. Ignoring these principles, Judge Posner ruled in Apex that a cleanup order constitutes a dischargeable “claim” when styled as a legal judgment but not when styled as an equitable injunction. This despite the fact that in either case the liability amounts to the same thing-payment must be made for …
Interpreting The Supreme Court’S Treatment Of The Chrysler Bankruptcy And Its Impact On Future Business Reorganizations, Fred N. David
Interpreting The Supreme Court’S Treatment Of The Chrysler Bankruptcy And Its Impact On Future Business Reorganizations, Fred N. David
Fred David
On June 9, 2009, the Supreme Court terminated its stay of Chrysler’s sale of substantially all of the company’s assets to a new entity, dubbed “New Chrysler” with the backing of European automaker Fiat. The effect of that ruling was to permit the sale to close the next day and bring to an end a chaotic period that determined Chrysler’s future. However, critics of the sale to Fiat argued that the Supreme Court’s ruling would also have a detrimental effect on secured credit and undermined the creditor protections normally afforded by Chapter 11 going forward.
But the Supreme Court was …
Bankruptcy Reorganizations And The Troubling Legacy Of Chrysler And Gm, Ralph E. Brubaker, Charles J. Tabb
Bankruptcy Reorganizations And The Troubling Legacy Of Chrysler And Gm, Ralph E. Brubaker, Charles J. Tabb
Ralph E. Brubaker
BANKRUPTCY REORGANIZATIONS AND THE
TROUBLING LEGACY OF CHRYSLER AND GM
Ralph Brubaker
University of Illinois College of Law
Charles Jordan Tabb
University of Illinois College of Law
Abstract:
The Chrysler and General Motors bankruptcy reorganizations represent the culmination of a sea-change in corporate restructuring practice that has occurred largely over the course of just the past decade. A bankruptcy reorganization has traditionally been effectuated though a chapter 11 plan of reorganization, with elaborate requirements for disclosure, creditor voting, and allocation of stakes in the reorganized debtor entity’s new capital structure among creditors and owners. Such an internal boot-strap reorganization, though, …
Bankruptcy Reorganizations And The Troubling Legacy Of Chrysler And Gm, Ralph E. Brubaker
Bankruptcy Reorganizations And The Troubling Legacy Of Chrysler And Gm, Ralph E. Brubaker
Ralph E. Brubaker
BANKRUPTCY REORGANIZATIONS AND THE
TROUBLING LEGACY OF CHRYSLER AND GM
Ralph Brubaker
University of Illinois College of Law
Charles Jordan Tabb
University of Illinois College of Law
Abstract:
The Chrysler and General Motors bankruptcy reorganizations represent the culmination of a sea-change in corporate restructuring practice that has occurred largely over the course of just the past decade. A bankruptcy reorganization has traditionally been effectuated though a chapter 11 plan of reorganization, with elaborate requirements for disclosure, creditor voting, and allocation of stakes in the reorganized debtor entity’s new capital structure among creditors and owners. Such an internal boot-strap reorganization, though, …
Simultaneous Distress Of Residential Developers And Their Secured Lenders: An Analysis Of Bankruptcy & Bank Regulation, Sarah P. Woo
Simultaneous Distress Of Residential Developers And Their Secured Lenders: An Analysis Of Bankruptcy & Bank Regulation, Sarah P. Woo
Sarah P Woo
With falling home prices and home foreclosures currently acknowledged as a severe problem in the U.S., more attention needs to be paid to the contributing phenomenon of residential developers undergoing liquidation, which has left behind a trail of partially-completed or abandoned properties. In order to understand this phenomenon, we analyzed 222 residential developers that filed Chapter 11 bankruptcy petitions between November 2007 and December 2008. We find that only a very small proportion of these developers, as compared to previous similar large studies, confirmed a reorganization plan. Most cases ended in liquidations. In the sample, 72.5% of the cases showed …
The Shadow Bankruptcy System, Jonathan C. Lipson
The Shadow Bankruptcy System, Jonathan C. Lipson
Jonathan C. Lipson
This article exposes and explores a puzzle at the heart of the current economic crisis: The surprising under-use, and increasing misuse, of Chapter 11 of the United States Bankruptcy Code, the principal legal system for salvaging troubled businesses.
The answer offered here: The rise of the shadow bankruptcy system. “Shadow bankruptcy” describes the severely under-regulated non-bank financial institutions (e.g., hedge funds, private equity funds and investment banks) that increasingly dominate and manipulate Chapter 11 reorganizations.
Like the “shadow banking” system for which it is named, shadow bankruptcy thrives on and promotes opacity and undisclosed, possibly perverse, incentives. Shadow bankruptcy players …
Failure's Futures: Controlling The Market For Information In Corporate Reorganization, Jonathan C. Lipson
Failure's Futures: Controlling The Market For Information In Corporate Reorganization, Jonathan C. Lipson
Jonathan C. Lipson
This Article identifies and explores an important gap in bankruptcy theory and policy, with significant implications for the coming wave of major business failures: How to manage information about financially distressed businesses?
The paper makes three claims. First, Chapter 11 of the United States Bankruptcy Code plays a unique informational role, as it creates mechanisms to explain a debtor’s failure and to promote reinvestment. Second, the information functions performed by this system face internal and external threats. Internally, bankruptcy reorganization increasingly resembles an unregulated securities market, dominated by sophisticated, wealthy investors whose motives and strategies are often highly opaque. Their …
The Doctrine Of Necessity In Bankruptcy Reorganizations, Rahul K. Sharma
The Doctrine Of Necessity In Bankruptcy Reorganizations, Rahul K. Sharma
Rahul K. Sharma
Necessity is an old concept used in many fields of law. In criminal law and torts, it is a defense. In property law, its reasoning is used to support eminent domain. This paper will analyze the use of the doctrine of necessity in bankruptcy reorganizations. In bankruptcy, necessity has also been used as a justification for paying certain creditors earlier than they would have otherwise been paid. This has become controversial as such payments became routine. A decision by the Seventh Circuit in the 2004 Kmart case strongly criticized such payments and criticized reliance upon the doctrine of necessity. This …
Collective Bargaining Agreements And Chapter 9 Bankruptcy, Ryan Preston Dahl
Collective Bargaining Agreements And Chapter 9 Bankruptcy, Ryan Preston Dahl
Ryan P Dahl
The recent cycle of automotive and aviation bankruptcies is ending. The next major restructuring cycle may come from a very different quarter. Municipalities throughout the United States will face the very real prospect of insolvency. The treatment of collective bargaining agreements will play a significant role in this process. Unaffordable collective bargaining obligations may be the efficient cause of such filings. Alternatively, rejecting such agreements may be the most effective means of restoring a municipal debtor’s financial health.
Statutory gaps, the absence of significant caselaw, and limited scholarly commentary raise serious questions as to how courts should treat collective bargaining …
Rio Grande Designs: Texans’ Nafta Water Claim Against Mexico, Paul Stanton Kibel, Jonathan R. Schutz
Rio Grande Designs: Texans’ Nafta Water Claim Against Mexico, Paul Stanton Kibel, Jonathan R. Schutz
Paul Stanton Kibel
No abstract provided.
Grasp On Water: A Natural Resource That Eludes Nafta's Notion Of Investment, Paul Stanton Kibel
Grasp On Water: A Natural Resource That Eludes Nafta's Notion Of Investment, Paul Stanton Kibel
Paul Stanton Kibel
No abstract provided.