Emory Bankruptcy Developments Journal

Volume 31Issue 2
The Twelfth Annual Emory Bankruptcy Developments Journal Symposium
Symposium

Introduction

Smita Gautam | 31 Emory Bankr. Dev. J. 213 (2015)

The Emory Bankruptcy Developments Journal hosted its Twelfth Annual Symposium on February 26, 2015. The Consumer Panel focused on student loan debt, featuring judicial, academic, and practical insights and a call to action to help consumers. The Corporate Panel looked at the interplay between the Affordable Care Act and the Bankruptcy Code, focusing on the state of the healthcare industry post-Affordable Care Act.

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Consumer Bankruptcy Panel: Undue Hardship: An Analysis of Student Loan Debt Discharge in Bankruptcy

C. Ray Mullins, Dalié Jiménez, Rafael Pardo, Elaine Poon | 31 Emory Bankr. Dev. J. 215 (2015)

The Consumer Panel focused on student loan debt, featuring judicial, academic, and practical insights and a call to action to help consumers.

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Corporate Bankruptcy Panel: The Healthcare Industry Post-Affordable Care Act: A Bankruptcy Perspective

Samuel Maizel, Colin Bernardino, Matthew Caine, Jeffrey Garfinkle | 31 Emory Bankr. Dev. J. 249 (2015)

The Corporate Panel looked at the interplay between the Affordable Care Act and the Bankruptcy Code, focusing on the state of the healthcare industry post-Affordable Care Act.

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Articles

Whether to Grant an Individual Chapter 11 Debtor an “Early” Discharge

Alan M. Ahart, Mark S. Wallace | 31 Emory Bankr. Dev. J. 277 (2015)

This Article provides a framework for determining whether to grant an “early” discharge to an individual chapter 11 debtor. An early discharge permits such a debtor to receive a discharge before making all payments under the confirmed plan. The Article analyzes the circumstances that warrant issuing such an early discharge, and what information ought to be included in the disclosure statement, plan, and notice of confirmation hearing. The Article concludes that an individual chapter 11 debtor may obtain a early discharge: (1) upon confirmation of a reorganization plan where the debtor has paid unsecured creditors before confirmation, or where necessary to keep important customers or to obtain financing to pay unsecured creditors, or (2) after plan confirmation but before plan payments are finished if the unsecured creditors have received the required distribution and the debtor no longer has sufficient income to meet living expenses and to make the required payments.

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Amending the Flaws in the Safe Harbors of the Bankruptcy Code: Guarding Against Systemic Risk in the Financial Markets and Adding Stability to the System

Peter Marchetti | 31 Emory Bankr. Dev. J. 305 (2015)

Certain provisions of derivative trading contracts get special exemptions under the Bankruptcy Code, referred to as “Safe Harbors,” to prevent systemic risk. The Safe Harbors seek to accomplish this goal by permitting a party to a derivative trading contract to quickly terminate and liquidate its positions. The precise parameters of the Safe Harbors remain unclear. This lack of clarity adversely affects the ability of market participants to accurately perform credit risk analyses with respect to their derivative trading counterparties and may adversely impact the ability of market participants to prepare Living Wills, as required by the Dodd-Frank Act. Similarly, it adversely affects the ability of a party to reorganize under the Bankruptcy Code. This Article argues that Congress should amend the Safe Harbors to address these issues to mitigate risk.

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“I Pronounce You Man and Man. You May Now File Jointly for Bankruptcy”: DOMA’s Unconstitutionality and Its Effect on Joint Bankruptcy Filings for Same-Sex Couples

Michael Tomback | 31 Emory Bankr. Dev. J. 375 (2015)

Windsor v. United States marked the erosion of the Defense of Marriage Act of 1996. Post-Windsor, the operative definition sections of that Act—defining “marriage” and “spouse” for “any Act of Congress”—no longer control. The meaning of marriage and spouse under federal law and, specifically, the Bankruptcy Code is now unclear. This Article argues that lawfully married same-sex couples should be allowed to file for bankruptcy jointly under 11 U.S.C. § 302 in all bankruptcy courts, even if the couple files jointly in a state that does not recognize their union. Under federalism principles, the Bankruptcy Code should apply the definitions of marriage and spouse from the state of celebration to provide same-sex couples equal access to the federal bankruptcy system. This Article proposes an interpretive framework that permits same-sex couples to file for bankruptcy jointly in any state while leaving state-level restrictions on marriages between same-sex couples untouched.

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Comments

A Study on Bankruptcy Crime Prosecution Under Title 18: Is the Process Undermining the Goals of the Bankruptcy System?

Leia Clement | 31 Emory Bankr. Dev. J. 409 (2015)

The federal bankruptcy system depends upon the United States Trustee Program to identify bankruptcy fraud and upon the United States Attorney’s Office to take appropriate action. This Comment seeks to provide insight into the factors that affect whether a case is selected for prosecution or dismissal. It analyzes the available data compiled on bankruptcy fraud cases from the fiscal years of 2010 and 2011 with respect to the following factors: specific bankruptcy fraud criminal violations, United States Code violations, the identity of the defendants, the types of bankruptcy filing involved, the verdicts, and the sentences resulting from guilty verdicts. This Comment concludes that bankruptcy fraud is not being sufficiently prosecuted, resulting in harm to creditors, debtors, the government, the court, and the public as well as the policies underlying the bankruptcy system.

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Creditors’ Committees: Giving Tort Claimants a Voice in Chapter 11 Bankruptcy Cases

Corinne McCarthy | 31 Emory Bankr. Dev. J. 431 (2015)

Unlike shareholders, lenders, or even the corporate debtor’s employees, tort claimants often do not choose to engage in commercial transactions with corporate debtors. Rather, their claims arise because the debtor has harmed them without their consent. While courts have the authority to form creditors’ committees for tort claimants, courts do not uniformly grant tort claimants’ requests. This Comment argues that courts should form creditors’ committees for tort claimants when corporate debtors with tort liability file for bankruptcy. First, there are strong policy reasons for forming creditors’ committees for tort claimants. Second, courts need to form creditors’ committees for tort claimants to ensure that tort claimants are guaranteed due process of the law. Third, forming creditors’ committees for tort claimants is consistent with the case law interpreting 11 U.S.C. § 1102(a)(2). Finally, forming creditors’ committees for tort claimants has practical significance.

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Stop Right There: Limiting Judicial Estoppel in the Bankruptcy Context

Mary Frances McKenna | 31 Emory Bankr. Dev. J. 465 (2015)

The majority of courts take the position that, if a plaintiff-debtor knew of a potential or pending lawsuit but failed to list it in the bankruptcy case, the plaintiff-debtor should be categorically estopped from pursuing the cause of action against the defendant. However, judicial estoppel produces an inequitable result where the plaintiff-debtor omitted a lawsuit from the bankruptcy case because of a mistake. In that case, the alleged wrongdoer prevails regardless of the strength of the plaintiff’s claim or the plaintiff’s culpability excluding the potential or pending lawsuit from the bankruptcy filings. This Comment argues that using a subjective inquiry to determine when to invoke judicial estoppel better serves the objectives of bankruptcy law and maintains the integrity of the judicial process. This subjective inquiry focuses on five factors to determine whether the debtor’s omission was the result of inadvertence or mistake.

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