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This panel will discuss the historical relationship between secured and unsecured creditors in reorganization cases, and explore recent instances where the groups have worked together to create value for their constituents. The panelists will include an overview of the key positions taken by each group, and will provide first-hand descriptions of how the constituents were able to achieve consensus.
Many lawyers viewed chapter 11, which came into effect in 1979, as unsuccessful in the 1980s. Large firms had been mired in bankruptcy for years — three years, on average. The process was seen as expensive, inaccurate and subject to abuse. While bankruptcy today still has problems with considerable conflict, and few would say it works perfectly, the overall contrast with bankruptcy today is stark: Bankruptcies that took years in the 1980s take months in the 2020s.
District Court Judge Frank Geraci of the Western District of New York stirred the pot on what seemed like a settled chapter 11 issue by reversing the bankruptcy court and rejecting the majority view on the fate of official committees upon dismissal of a chapter 11 case.[1]
Several debts are “excepted” from the bankruptcy discharge. [1] Corporate debtors can overcome some of these exceptions to the discharge through chapter 11. [2] But before a corporate debtor can get its discharge, it must confirm a plan, and only 20% of regular chapter 11 plans are confirmed. [3]
What’s been going on in the bankruptcy claims marketplace over the past year? Crypto, crypto, crypto, sprinkled in with a little bit of trucking, courtesy of the Yellow Corp. case. [1]
The Third Circuit has a reputation as being a “plain meaning” court — meaning that it strictly construes and applies the words of a statute. Its Jan. 19, 2024, opinion in In re FTX Trading Ltd. [1] is an example. The relevant facts in the “highly complex” FTX bankruptcy were few and straightforward as they related to the question before the court: “whether 11 U.S.C. § 1104(c)(2) mandates bankruptcy courts to grant the U.S.
The Business Reorganization Committee had a busy and successful 2023, and we are already looking forward to another great year in 2024.
Over the past year, committee members took advantage of the many benefits afforded them, including the committee’s newsletters and educational programs, and have taken part in active discussions over the listserv regarding hot topics and industry trends. We have big plans for 2024, and we thank our committee members and leadership for their support and continued participation.
