Modern Chapter 11 Practice
The sale of financially distressed firms as a going concern has been the dominant trend in U.S. business bankruptcy law for the last ten years. An increasing proportion of bankrupt firms use Chapter 11 not as a traditional reorganization mechanism but as a convenient auction block. Indeed, many firms now file for Chapter 11 in order to effectuate a going concern sale as opposed to writing down debt. This trend, that gained so much momentum, has led scholars to distinguish between a traditional and a modern Chapter 11 practice and, ultimately, debate over the need for Chapter 11’s very existence.
Starting from the foundation of the U.S. corporate reorganization law, the equity receivership, this seminar will deal with the key issues arising in the course of distressed asset sales and attempt to explain how the current law, business and economic environment has favored sales over rehabilitations, thus changing the face of traditional Chapter 11 practice.
The final grade will be heavily determined (70%) by a paper of approximately 15 pages that will have to be submitted at the end of the semester. Class participation will be also taken into consideration (30%). Please note that this seminar may be used to satisfy the writing requirement.Credits: 2