Bankruptcy Law Commons^™

Chapter 11 Liquidation And Its Effect On Collective Bargaining Agreements, Dylan Coyne

Bankruptcy Research Library

(Excerpt)

Sections 1113 and 1114 of title 11 of the United States Code (the “Bankruptcy Code”) allow a debtor to reject its collective bargaining agreements and payment of retiree benefits, subject to certain statutory conditions being met. These provisions apply to companies that employ unionized workers who receive compensation and benefits pursuant to a collective bargaining agreement. Both sections, however, only apply to a debtor that is “reorganizing.” Moreover, courts have held that section 1114, which governs the payment of insurance benefits to retirees, permits modification of obligations under a statute, such as the Coal Industry Retiree Health Benefit Act …

Effects Of Veil Piercing, Alter Ego And Substantive Consolidation On Bankruptcy, Lauren Gross

Bankruptcy Research Library

(Excerpt)

At times, bankruptcy can seem like a game of cat and mouse between debtors and creditors. By filing for bankruptcy in the first place, debtors change the rules of the game with various bankruptcy mechanisms, such as the automatic stay provision set forth in section 361 of the United States Bankruptcy Code (the “Bankruptcy Code”). An important inquiry exists in what creditors can to do promote their interests in bankruptcy. An even more important inquiry lies in determining what doctrines may satisfy generally recognized principles of equity for all.

One option for creditors who deal with corporate entities is …

Creditors Cannot Contract Around Their Fiduciary Duties And Withhold Their Consent From A Debtor To File For Bankruptcy, Samantha Guido

Bankruptcy Research Library

(Excerpt)

Many courts have found that a debtor may not contract away their right to voluntarily file for bankruptcy. However, debtors and creditors have implemented creative measures to avoid this principle. For example, a creditor may seek the appointment of a so-called “blocking director” on a company’s board of directors, who would control the company’s bankruptcy filing. Additionally, some creditors seek a “golden share” in order to have veto power over changes to the company’s charter, including veto power over whether the company can file for bankruptcy. In determining whether these mechanisms are void under public policy, courts will consider …

A Dragnet Clause And A Future Advances Clause Can Reach The Collateral Of A Loan That Has Already Been Repaid, Stephanie Hung

Bankruptcy Research Library

(Excerpt)

This memorandum will explore the secured transactions issues that arose in In re Omni Enterprises. In that case, the Bankruptcy Court in Alaska held that a bank may enforce the security interest of a prior loan that has already been repaid to cure a new loan that was in default. The prior loan was secured by the debtor’s deposit accounts, and contained a cross-collateralization clause and future advances clause; however, the new loan did not mention the deposit accounts at all. When the debtor defaulted on the new loan, the bank argued, among other things, that it continued …

When Are Debtors And Creditors Bound To The Provisions Of Confirmed Reorganization Plans?, Gabriella Labita

Bankruptcy Research Library

(Excerpt)

Generally, when a debtor files for protection under chapter 11 of the United States Bankruptcy Code (the “Bankruptcy Code”), a plan of reorganization is filed at some point with the bankruptcy court. The court then holds a hearing to determine whether the judge will confirm the reorganization plan. The judge will confirm the plan if it meets the criteria of Section 1129 of the Bankruptcy Code, which requires, among other things, that any payments made in connection with the plan are reasonable. A plan of reorganization is a significant component of a debtor’s emergence from bankruptcy, as it affects …

Federal Preemption And The Bankruptcy Code: At What Point Does State Law Cease To Apply During The Claims Allowance Process?, Dylan Lackowitz

Bankruptcy Research Library

(Excerpt)

Anything you do in bankruptcy can and will be used against you in bankruptcy. Prior to the commencement of a bankruptcy case, perhaps courts should issue this Miranda-esque warning to the parties. At least, if the bankruptcy court had, Plymouth LLC (“Plymouth”) might have saved approximately $800,000 that it spent acquiring a lien against Princeton LP’s (“Princeton”) vacant office park in the Township of Lawrence, New Jersey. Recently, the United States Court of Appeals for the Third Circuit held that Plymouth’s claim against Princeton in Princeton’s bankruptcy case was disallowed for violating New Jersey’s tax sale law pursuant to …

All Talk, But No Action Leads To The Loss Of Ground Breaking Cancer Research, Nicholas Marcello

Bankruptcy Research Library

(Excerpt)

Each year, the government awards millions of dollars in federal grants to fund scientific research. Despite this huge allocation of resources, the government’s claim in such funded research may be limited should the receiving institution become a debtor in bankruptcy. Last year, the United States Bankruptcy Court for the District of Massachusetts allowed the destruction of government funded research to benefit the debtor estate.

The Inconsistent Application Of Section 1113 To Expired Collective Bargaining Agreements, Courtney Creighton Sokol

Bankruptcy Research Library

(Excerpt)

The United States Bankruptcy Code (the “Bankruptcy Code”) allows a trustee a debtor-in-possession (“DIP”) to assume or reject a collective bargaining agreement (“CBA”). Courts are split on whether a trustee or DIP may reject an expired collective bargaining agreement under section 1113 of the Bankruptcy Code. In general, a collective bargaining agreement may be rejected notwithstanding the labor standards afforded to employees by the National Labor Relations Act (“NLRA”). In particular, under the NLRA, an employer that is party to a CBA is obligated to bargain with its employees until the employer either enters into a new contract or …

'No Money Down' Bankruptcy, Pamela Foohey, Robert M. Lawless, Katherine Porter, Deborah Thorne

Scholarly Works

This Article reports on a breakdown in access to justice in bankruptcy, a system from which one million Americans will seek help this year. A crucial decision for these consumers will be whether to file a chapter 7 or chapter 13 bankruptcy. Nearly every aspect of their bankruptcies — both the benefits and the burdens of debt relief — will be different in chapter 7 versus chapter 13. Almost all consumers will hire a bankruptcy attorney. Because they must pay their attorneys, many consumers will file chapter 13 to finance their access to the law, rather than because they prefer …

Lender Discrimination, Black Churches, And Bankruptcy, Pamela Foohey

Scholarly Works

Based on my original empirical research, in this Article, I expose a disparity between the demographics of the roughly 650 religious congregations that have filed for chapter 11 bankruptcy during part of the last decade and congregations nationwide. Churches with predominately black membership — Black Churches — appeared in chapter 11 more than three times as often as they appear among churches across the country. A conservative estimate of the percentage of Black Churches among religious congregation chapter 11 debtors is 60%. The likely percentage is upward of 75%. Black Churches account for 21% of congregations nationwide.

Why are Black …

Easy Credit And The Erosion Of Dischargeable Debt In Bankruptcy: Advocating For A Broad Interpretation Of 11 U.S.C. § 523(A)(2)(A) & (B)'S "Statement Respecting.. . Financial Condition", Tyler Sandifer

Georgia Law Review

The Bankruptcy Code largely exists to provide a
"fresh start" to debtors. But not everyone gets a free
pass. If a debtor has intentionally lied in order to
obtain money, property, services, or an extension,
renewal, or refinancing of credit, he receives no
protection. However, there is an exception built into the
code to protect debtors from predatory lenders intent on
gaming the system in an effort to eliminate insolvency
risk. The size of this exception has become a matter of
judicial debate over the past thirty-eight years as a
circuit split has slowly developed over the
interpretation of 11 …