Browsing by Subject "bankruptcy"

Now showing 1 - 8 of 8
  • Thumbnail Image
    Item
    Bankruptcy for Productivity
    (2002) Georgakopoulos, Nicholas L.
    The accepted economic function of bankruptcy law is that it resolves collective action problems between self-interested creditors. This article argues that this collective-action-resolving function is only one of a multitude of expressions of an overarching economic motivation of bankruptcy law. Bankruptcy law seeks to avoid productivity-destroying consequences of insolvency. The principal expressions of this policy are more prominent features of the bankruptcy system than its collective-action-resolving provisions. The fresh start policy avoids the destruction of individual productivity incentives. The reorganization chapter avoids misallocations and false liquidations due to credit crunches and disrupted markets. The creation of trust funds for future victims of past torts solves the erroneous liquidation incentive that a vicious cycle of tort-driven insolvencies creates. The priority of tort claims during the reorganization cures wasteful incentives for sub-optimal care. None of these fundamental choices is explained as a solution to creditors' collective action problem. Moreover, the resolution of the creditors' collective action problem prevents the destruction of value, becoming itself one more expression in this group of avoiding the economic distortions that insolvency may cause. Closing, I argue that bankruptcy law must address these concerns because they require a study of the debtor's relations in their totality that state law is unlikely to be able to perform. The desired regulatory competition should be provided in the context of the structure of the federal judiciary.
  • Thumbnail Image
    Item
    Electronic Discovery and Bankruptcy: A Review of Recent Cases
    (2012) Hook, Sara Anne
    This article is the third in a series about electronic discovery in bankruptcy. The first article covered the basics of electronic discovery, including history, rules and resources. The second discussed the discoverability of information found on social media sites such as Facebook, YouTube and LinkedIn, and how these sites can be rich sources of evidence for bankruptcy cases. This article will discuss the application of electronic discovery to bankruptcy practice and examine some recent bankruptcy cases where electronic discovery issues were particularly significant A final article will review current technologies that can assist with electronic discovery before and during litigation, introduce examples where the failure to handle the electronic discovery process properly resulted in sanctions and discuss the lessons that can be learned from these examples.
  • Thumbnail Image
    Item
    Electronic Discovery and Bankruptcy: Technology, Sanctions and Lessons Learned
    (2012) Hook, Sara Anne
    This article is the last in a series of articles about electronic discovery in bankruptcy. The first article covered the basics of electronic discovery, including history, rules and resources. The second article discussed the discoverability of information found on social media sites, such as Facebook, YouTube and LinkedIn, and how these sites can be rich sources of evidence for bankruptcy cases. The third article discussed the application of electronic discovery to bankruptcy practice and examined some recent bankruptcy cases where electronic discovery issues were particularly significant. This final article will review current technologies that can assist with electronic discovery before and during litigation, describe some of the ethical duties of attorneys in electronic discovery, provide examples of cases where failure to handle the electronic discovery process properly resulted in sanctions and discuss the lessons that can be learned from these examples.
  • Thumbnail Image
    Item
    Electronic Discovery: The Basics
    (2011) Hook, Sara Anne
    This article is the first in a series about electronic discovery in bankruptcy. This article will cover the basics of electronic discovery, including history, rules and resources. Future articles will apply electronic discovery principles to bankruptcy law practice, review current technologies that can assist with electronic discovery before and during litigation and discuss examples where the failure to properly handle the electronic discovery process properly in bankruptcy cases resulted in sanctions and the lessons that can be learned from these cases.
  • Thumbnail Image
    Item
    Feeling Insecure-A State View of Whether Investors in Municipal General Obligation Bonds Have a Mere Promise to Pay or a Binding Obligation
    (2015-02) Pollard, Randle B.; Kelley School of Business
    The City of Detroit's filing for municipal bankruptcy in July, 2013, has added to a continuing controversy of whether general obligation bondholders have a secured lien. The City of Detroit claimed its general obligation bondholders did not have a fully secured lien because the law of the state of Michigan did not create a statutory lien. Without the creation of a lien by state law, during the insolvency or bankruptcy of municipalities, general obligation bondholders will potentially have a mere promise to pay versus a binding obligation to pay, and therefore, will not have a secured lien. Treating otherwise secured general obligation bonds as unsecured will create more risk for investors and increase the cost of borrowing for cities. This article discusses the treatment of general obligation bonds in recent municipal bankruptcies; identifies the states that create a binding obligation to pay general obligation bondholders; describes problems of not treating general obligation bonds as secured; and proposes that states create clear laws that grant statutory liens for general obligation bondholders.
  • Thumbnail Image
    Item
    New Value, Fresh Start
    (1997) Georgakopoulos, Nicholas L.
    In this article, the author enters into the debate about the desirability of the "new value" exception to Bankruptcy Law's absolute priority rule. After a description of the theory's origins, the author rejects the formal and textual argument that the exception did not survive the enactment of the Bankruptcy Code, as well as rejecting the arguments that the exception serves no useful function under the voting procedures of the Code, and that it wrongly confers a post-reorganization option-like value to equityholders on account of their pre-petition claims. The author proceeds to argue that the new value exception is necessary because fair new equity auctions would be rare in the reorganization context, because the quasi-option characteristics of the ability to file a reorganization plan using the new value exception provide socially desirable incentives to business owners, and because the new value exception is consistent with, and promotes, the fresh start policy. Moreover, providing the fresh start through the new value exception is preferable compared to its current provision through the rejection of injunctive obligations not to compete. The conclusion sketches the reorganization process toward which the law should move.
  • Thumbnail Image
    Item
    Social Media and Electronic Discovery: A Potential Source of Evidence in Bankruptcy Proceedings
    (2011) Hook, Sara Anne; Taht, Katherine A.
    This article is the second in a series about electronic discovery in bankruptcy. The first article covered the basics of electronic discovery, including history, rules and resources. This article will discuss the discoverability of information found on social media sites such as Facebook, YouTube and LinkedIn, and how these sites can be rich sources of evidence for bankruptcy cases. Future articles will apply electronic discovery principles to bankruptcy law practice, review current technologies that can assist with electronic discovery before and during litigation and introduce examples where the failure to handle the electronic discovery process properly resulted in sanctions and the lessons that can be learned from these examples.
  • Thumbnail Image
    Item
    Worlds Colliding: Competition Policy and Bankruptcy Asset Sales
    (2015) Huffman, Max; Robert H. McKinley School of Law
    Modern business bankruptcies commonly involve mergers and acquisitions pursued as “fire sales.” The bankruptcy forum and the unique incentives bankruptcy creates allow those acquisitions to take place with reduced constituent involvement and regulatory oversight. Those fire sale transactions may present antitrust concerns where they lead to undue concentration in the relevant marketplace. This Article studies the poorly explored tension between bankruptcy law, which favors mergers and acquisitions as value maximizing propositions and creates opportunity for fire sales, and antitrust law, which disfavors combinations leading to undue concentrations of economic power. The tension is substantial and manifests both as a matter of substantive law and as a matter of procedures used to implement that law. This paper reveals conflicts between bankruptcy and antitrust and argues that the optimal resolution of those conflicts is to correct for the current subordination of antitrust goals to bankruptcy policies. The Article then offers suggestions for reform.