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This Review Essay situates Christopher Bruner’s new book, Re-imagining Offshore Finance, within the literature examining the regulation of cross-border finance and highlights its import for thinking about the complicated (and contested) relationship between territorially-configured domestic laws and the increasingly liberal movement of capital. Part I sets out the book’s central thesis. In addition to highlighting Bruner’s novel framework identifying the factors that propel certain small jurisdictions into becoming magnets for cross-border finance, I outline the limits of the framework in accounting for the stability in the overall demand for the commercialization of sovereignty, only one of which is facilitating international tax evasion. Part II examines the rise of offshore financial havens as they relate to the territorially-configured domestic rules — a subject that has yet to attract the attention that it deserves. While the rise of offshore financial havens has been viewed as typifying the continued dominance of territorial sovereignty, I show that it is private choice and juridical rules that have been privileged over strictly territorial conceptions of the law. I use recent developments in corporate law and bankruptcy law to show that domestic laws governing certain financial transactions are already ceding to privately-curated juridical rules, albeit not without resistance.

Corporate directors committed to a failed business strategy or unduly influenced by the company’s debtholders need a dissenting voice—they need shareholder nominees on the board. This article examines the bias, conflicts, and external factors that impact board decisions, particularly when a company faces financial distress. It challenges the conventional wisdom that debt disciplines management, and it suggests that, in certain circumstances, the company would benefit from having the shareholders’ perspective more actively represented on the board. To that end, the article proposes a bylaw that would give shareholders the ability to nominate directors upon the occurrence of predefined events. Such targeted proxy access would incentivize boards to manage difficult operational and financial situations more proactively, while creating a reasonable oversight mechanism for shareholders if those efforts fail. The article also discusses ways for shareholders to use general proxy access in distressed situations to strengthen the shareholder perspective in, and add value to, boards’ negotiations with debtholders. Yet failing the utility of traditional, general proxy methodology, the article suggests that targeted proxy access is a more tailored solution that mitigates many of the concerns articulated in the proxy access debate and provides a better balance between management autonomy and accountability.

When a company is worth more as a going concern than on a liquidation basis, what creates that additional value? Is it the people, management decisions, the simple synergies of the operating business, or some combination of these types of soft variables? And perhaps more importantly, who owns or has an interest in these soft variables? This article explores these questions under existing legal doctrine and practice norms. Specifically, it discusses the characterization of soft variables under applicable law and in financing documents, and it surveys related judicial decisions. It also considers the overarching public policy and Constitutional implications of the treatment of soft variables in and outside of the federal bankruptcy scheme. The article concludes by considering the optimal treatment of soft variables in corporate reorganizations.

When a company is worth more as a going concern than on a liquidation basis, what creates that additional value? Is it the people, management decisions, the simple synergies of the operating business, or some combination of these types of soft variables? And perhaps more importantly, who owns or has an interest in these soft variables? This article explores these questions under existing legal doctrine and practice norms. Specifically, it discusses the characterization of soft variables under applicable law and in financing documents, and it surveys related judicial decisions. It also considers the overarching public policy and Constitutional implications of the treatment of soft variables in and outside of the federal bankruptcy scheme. The article concludes by considering the optimal treatment of soft variables in corporate reorganizations.

When a company is worth more as a going concern than on a liquidation basis, what creates that additional value? Is it the people, management decisions, the simple synergies of the operating business, or some combination of these types of soft variables? And perhaps more importantly, who owns or has an interest in these soft variables? This article explores these questions under existing legal doctrine and practice norms. Specifically, it discusses the characterization of soft variables under applicable law and in financing documents, and it surveys related judicial decisions. It also considers the overarching public policy and Constitutional implications of the treatment of soft variables in and outside of the federal bankruptcy scheme. The article concludes by considering the optimal treatment of soft variables in corporate reorganizations.

When a company is worth more as a going concern than on a liquidation basis, what creates that additional value? Is it the people, management decisions, the simple synergies of the operating business, or some combination of these types of soft variables? And perhaps more importantly, who owns or has an interest in these soft variables? This article explores these questions under existing legal doctrine and practice norms. Specifically, it discusses the characterization of soft variables under applicable law and in financing documents, and it surveys related judicial decisions. It also considers the overarching public policy and Constitutional implications of the treatment of soft variables in and outside of the federal bankruptcy scheme. The article concludes by considering the optimal treatment of soft variables in corporate reorganizations.

When a company is worth more as a going concern than on a liquidation basis, what creates that additional value? Is it the people, management decisions, the simple synergies of the operating business, or some combination of these types of soft variables? And perhaps more importantly, who owns or has an interest in these soft variables? This article explores these questions under existing legal doctrine and practice norms. Specifically, it discusses the characterization of soft variables under applicable law and in financing documents, and it surveys related judicial decisions. It also considers the overarching public policy and Constitutional implications of the treatment of soft variables in and outside of the federal bankruptcy scheme. The article concludes by considering the optimal treatment of soft variables in corporate reorganizations.

Hedge funds, private equity firms, and other alternative investment funds are frequently key players in corporate restructurings. Most commentators agree that the presence of a fund can change the dynamics of a chapter 11 case. They cannot agree, however, on the impact of this change—i.e., do funds create or destroy enterprise value? This essay contributes to the dialogue by analyzing data from chapter 11 cases in which funds are in a position to influence the debtor’s exit strategy. The data shed light on what such funds might achieve in chapter 11 cases and the potential implications for debtors and their other stakeholders. Although additional research is needed, the preliminary data suggest that the value of fund participation in chapter 11 cases likely depends on whom you ask and where they sit in the particular debtor’s capital structure.

Hedge funds, private equity firms, and other alternative investment funds are frequently key players in corporate restructurings. Most commentators agree that the presence of a fund can change the dynamics of a chapter 11 case. They cannot agree, however, on the impact of this change—i.e., do funds create or destroy enterprise value? This essay contributes to the dialogue by analyzing data from chapter 11 cases in which funds are in a position to influence the debtor’s exit strategy. The data shed light on what such funds might achieve in chapter 11 cases and the potential implications for debtors and their other stakeholders. Although additional research is needed, the preliminary data suggest that the value of fund participation in chapter 11 cases likely depends on whom you ask and where they sit in the particular debtor’s capital structure.

A robust, effective, and efficient bankruptcy system rebuilds companies, preserves jobs, and facilitates economic growth with dynamic financial markets and lower costs of capital. For more than 35 years, the U.S. Bankruptcy Code has served these purposes, and its innovative debtor in possession chapter 11 process, which allows a company to manage and direct its reorganization efforts, is emulated around the globe. As with any law or regulation, however, periodic review of U.S. bankruptcy laws is necessary to ensure their continued efficacy and relevance. Whether by design or chance, efforts to review and assess U.S. business reorganization laws are undertaken approximately every 40 years. Such efforts have led to federal legislation effecting meaningful revisions to business reorganization laws in 1898, 1938, and 1978. It may be that four decades is the maximum amount of time that any financially driven regulation can remain relevant. Markets and financial products, as well as industry itself, often evolve far more quickly than the regulations intended to govern them. It may be that significant economic crises tend to occur cyclically and encourage reevaluation of the federal bankruptcy laws. Regardless, the general consensus among restructuring professionals is that the time has come once again to evaluate U.S. business reorganization laws. Accordingly, the American Bankruptcy Institute (the “ABI”) established the Commission to Study the Reform of Chapter 11 (the “Commission”) for this precise purpose., https://digitalcommons.law.umaryland.edu/books/1096/thumbnail.jpg

Hedge funds, private equity firms, and other alternative investment funds are frequently key players in corporate restructurings. Most commentators agree that the presence of a fund can change the dynamics of a chapter 11 case. They cannot agree, however, on the impact of this change—i.e., do funds create or destroy enterprise value? This essay contributes to the dialogue by analyzing data from chapter 11 cases in which funds are in a position to influence the debtor’s exit strategy. The data shed light on what such funds might achieve in chapter 11 cases and the potential implications for debtors and their other stakeholders. Although additional research is needed, the preliminary data suggest that the value of fund participation in chapter 11 cases likely depends on whom you ask and where they sit in the particular debtor’s capital structure.

A robust, effective, and efficient bankruptcy system rebuilds companies, preserves jobs, and facilitates economic growth with dynamic financial markets and lower costs of capital. For more than 35 years, the U.S. Bankruptcy Code has served these purposes, and its innovative debtor in possession chapter 11 process, which allows a company to manage and direct its reorganization efforts, is emulated around the globe. As with any law or regulation, however, periodic review of U.S. bankruptcy laws is necessary to ensure their continued efficacy and relevance. Whether by design or chance, efforts to review and assess U.S. business reorganization laws are undertaken approximately every 40 years. Such efforts have led to federal legislation effecting meaningful revisions to business reorganization laws in 1898, 1938, and 1978. It may be that four decades is the maximum amount of time that any financially driven regulation can remain relevant. Markets and financial products, as well as industry itself, often evolve far more quickly than the regulations intended to govern them. It may be that significant economic crises tend to occur cyclically and encourage reevaluation of the federal bankruptcy laws. Regardless, the general consensus among restructuring professionals is that the time has come once again to evaluate U.S. business reorganization laws. Accordingly, the American Bankruptcy Institute (the “ABI”) established the Commission to Study the Reform of Chapter 11 (the “Commission”) for this precise purpose., https://digitalcommons.law.umaryland.edu/books/1096/thumbnail.jpg

Hedge funds, private equity firms, and other alternative investment funds are frequently key players in corporate restructurings. Most commentators agree that the presence of a fund can change the dynamics of a chapter 11 case. They cannot agree, however, on the impact of this change—i.e., do funds create or destroy enterprise value? This essay contributes to the dialogue by analyzing data from chapter 11 cases in which funds are in a position to influence the debtor’s exit strategy. The data shed light on what such funds might achieve in chapter 11 cases and the potential implications for debtors and their other stakeholders. Although additional research is needed, the preliminary data suggest that the value of fund participation in chapter 11 cases likely depends on whom you ask and where they sit in the particular debtor’s capital structure.

Hedge funds, private equity firms, and other alternative investment funds are frequently key players in corporate restructurings. Most commentators agree that the presence of a fund can change the dynamics of a chapter 11 case. They cannot agree, however, on the impact of this change—i.e., do funds create or destroy enterprise value? This essay contributes to the dialogue by analyzing data from chapter 11 cases in which funds are in a position to influence the debtor’s exit strategy. The data shed light on what such funds might achieve in chapter 11 cases and the potential implications for debtors and their other stakeholders. Although additional research is needed, the preliminary data suggest that the value of fund participation in chapter 11 cases likely depends on whom you ask and where they sit in the particular debtor’s capital structure.

Entity choice law is constantly evolving and innovating. The series LLC form is one such example. Although the form provides governance and operational flexibility and efficiencies, the law governing the form is still developing. As such, uncertainties linger, particularly in the context of a financially distressed or insolvent series. This article explores many of the issues that arise when a master LLC or one of its series experiences financial distress and contemplates a bankruptcy filing. It also identifies strategies for parties to potentially mitigate certain of these issues in the planning stage. The article concludes by suggesting parties using the series LLC form consider its overall impact on the business plan and objectives, including potential negative consequences on the rights and remedies of owners and certain creditors and on the cost of capital.

Entity choice law is constantly evolving and innovating. The series LLC form is one such example. Although the form provides governance and operational flexibility and efficiencies, the law governing the form is still developing. As such, uncertainties linger, particularly in the context of a financially distressed or insolvent series. This article explores many of the issues that arise when a master LLC or one of its series experiences financial distress and contemplates a bankruptcy filing. It also identifies strategies for parties to potentially mitigate certain of these issues in the planning stage. The article concludes by suggesting parties using the series LLC form consider its overall impact on the business plan and objectives, including potential negative consequences on the rights and remedies of owners and certain creditors and on the cost of capital.

The legal market has changed. Although change creates uncertainty and fear, it also can create opportunity. This essay explores the opportunity for innovation in the business law curriculum, and the role of simulation to help create more practice-aware new lawyers.

Entity choice law is constantly evolving and innovating. The series LLC form is one such example. Although the form provides governance and operational flexibility and efficiencies, the law governing the form is still developing. As such, uncertainties linger, particularly in the context of a financially distressed or insolvent series. This article explores many of the issues that arise when a master LLC or one of its series experiences financial distress and contemplates a bankruptcy filing. It also identifies strategies for parties to potentially mitigate certain of these issues in the planning stage. The article concludes by suggesting parties using the series LLC form consider its overall impact on the business plan and objectives, including potential negative consequences on the rights and remedies of owners and certain creditors and on the cost of capital.

Entity choice law is constantly evolving and innovating. The series LLC form is one such example. Although the form provides governance and operational flexibility and efficiencies, the law governing the form is still developing. As such, uncertainties linger, particularly in the context of a financially distressed or insolvent series. This article explores many of the issues that arise when a master LLC or one of its series experiences financial distress and contemplates a bankruptcy filing. It also identifies strategies for parties to potentially mitigate certain of these issues in the planning stage. The article concludes by suggesting parties using the series LLC form consider its overall impact on the business plan and objectives, including potential negative consequences on the rights and remedies of owners and certain creditors and on the cost of capital.

Entity choice law is constantly evolving and innovating. The series LLC form is one such example. Although the form provides governance and operational flexibility and efficiencies, the law governing the form is still developing. As such, uncertainties linger, particularly in the context of a financially distressed or insolvent series. This article explores many of the issues that arise when a master LLC or one of its series experiences financial distress and contemplates a bankruptcy filing. It also identifies strategies for parties to potentially mitigate certain of these issues in the planning stage. The article concludes by suggesting parties using the series LLC form consider its overall impact on the business plan and objectives, including potential negative consequences on the rights and remedies of owners and certain creditors and on the cost of capital.

Entity choice law is constantly evolving and innovating. The series LLC form is one such example. Although the form provides governance and operational flexibility and efficiencies, the law governing the form is still developing. As such, uncertainties linger, particularly in the context of a financially distressed or insolvent series. This article explores many of the issues that arise when a master LLC or one of its series experiences financial distress and contemplates a bankruptcy filing. It also identifies strategies for parties to potentially mitigate certain of these issues in the planning stage. The article concludes by suggesting parties using the series LLC form consider its overall impact on the business plan and objectives, including potential negative consequences on the rights and remedies of owners and certain creditors and on the cost of capital.

Entity choice law is constantly evolving and innovating. The series LLC form is one such example. Although the form provides governance and operational flexibility and efficiencies, the law governing the form is still developing. As such, uncertainties linger, particularly in the context of a financially distressed or insolvent series. This article explores many of the issues that arise when a master LLC or one of its series experiences financial distress and contemplates a bankruptcy filing. It also identifies strategies for parties to potentially mitigate certain of these issues in the planning stage. The article concludes by suggesting parties using the series LLC form consider its overall impact on the business plan and objectives, including potential negative consequences on the rights and remedies of owners and certain creditors and on the cost of capital.

The legal market has changed. Although change creates uncertainty and fear, it also can create opportunity. This essay explores the opportunity for innovation in the business law curriculum, and the role of simulation to help create more practice-aware new lawyers.

Cross-border bankruptcy continues to be an important topic within bankruptcy regimes worldwide. As more corporations find themselves interacting in a market without the confines of geographic borders, countries need to adapt their regulatory schemes to be able to properly handle an orderly liquidation or reorganization without an adverse impact on the economy. This paper discuses the challenges of a cross-border bankruptcy regime that would be effective and proposes a cooperative solution for increasing coordination among insolvency proceedings. As a result of increasing cooperation among jurisdiction in light of the recent and ongoing financial crisis, reform within the bankruptcy regimes around the world is foreseeable.

Cross-border bankruptcy continues to be an important topic within bankruptcy regimes worldwide. As more corporations find themselves interacting in a market without the confines of geographic borders, countries need to adapt their regulatory schemes to be able to properly handle an orderly liquidation or reorganization without an adverse impact on the economy. This paper discuses the challenges of a cross-border bankruptcy regime that would be effective and proposes a cooperative solution for increasing coordination among insolvency proceedings. As a result of increasing cooperation among jurisdiction in light of the recent and ongoing financial crisis, reform within the bankruptcy regimes around the world is foreseeable.

The core of many companies' business model depends heavily on access to a trademark license. Unfortunately, despite possessing a license and turning a profit, some of these companies run into difficulties and are forced to file for chapter 11. This article analyzes the legal issues faced by a company in this situation. First, it explores the existing tension at the intersection of bankruptcy and trademark law, then discusses the three approaches courts have taken to resolving this tension. It concludes with the proposal that only one of these approaches appropriately balances the competing interests at stake.

The core of many companies' business model depends heavily on access to a trademark license. Unfortunately, despite possessing a license and turning a profit, some of these companies run into difficulties and are forced to file for chapter 11. This article analyzes the legal issues faced by a company in this situation. First, it explores the existing tension at the intersection of bankruptcy and trademark law, then discusses the three approaches courts have taken to resolving this tension. It concludes with the proposal that only one of these approaches appropriately balances the competing interests at stake.

General corporate law delegates the power to manage a corporation to the board of directors. The board in turn acts as a fiduciary and generally owes its duties to the corporation and its shareholders. Many courts and commentators summarize the board’s primary objective as maximizing shareholder wealth. Accordingly, one would expect a board’s conduct to be governed largely by the interests of the corporation and its shareholders. Yet, anecdotal and increasing empirical evidence suggest that large creditors wield significant influence over their corporate debtors. Although this influence is most apparent as the corporation approaches insolvency, the strength of the creditors’ negotiating position often is based on the terms of the pre-insolvency contract. Creditors typically obtain restrictive covenants and veto rights that allow them to assert control over various corporate actions. Nevertheless, the extent of creditor influence is hard to gauge accurately because it frequently materializes behind closed doors, in negotiations between the corporation and creditors over refinancing terms, forbearance agreements, covenant waivers or rescue financing. This Article attempts to shed some light on the nature and extent of creditor influence by examining creditor influence over corporate debtors and creditors’ committees in Chapter 11 reorganization cases. Specifically, it reports and analyzes data from an empirical survey of professionals and individual creditors participating in the Chapter 11 process. In many respects, the data confirm what commentators have gleaned from the terms of creditors’ contracts and activity documented on Chapter 11 dockets—creditors are trying to exert greater influence over corporate decisions in the restructuring context.

The number of businesses experiencing financial distress increased significantly during the past several years. The number of Chapter 11 reorganization cases likewise rose. And many of these business failures were spectacular, leaving little value for creditors and even less for shareholders. Consequently, how the business debtor’s limited asset pie is divided and who gets to allocate the pieces are very relevant and important questions. The U.S. Bankruptcy Code generally contemplates the appointment of a committee of the debtors’ unsecured creditors to serve as a fiduciary for all general unsecured creditors and as a statutory watchdog over the debtor and its assets. The creditors’ committee typically includes seven to nine of the debtor’s largest unsecured creditors, and it receives access to much of the debtor’s proprietary and confidential information, as well as a seat at the plan of reorganization negotiation table. Serving as a member of the creditors’ committee often gives a creditor a say in how the asset pie is divided. Whether that creditor uses its committee seat for the benefit of all creditors or simply to further its own agenda is an open question. This Article presents the first in-depth empirical analysis of the activities of creditors’ committees in, and their impact on, Chapter 11 reorganization cases. The primary data examine approximately 296 Chapter 11 cases in six different jurisdictions. This analysis is supplemented by survey data collected from individuals who have served on creditors’ committees or worked as a professional to business debtors or creditors’ committees. The data support several strong associations between the presence of a creditors’ committee and, for example, whether the debtor reorganizes or pursues a sale of substantially all of its assets and the ultimate percentage recovery distributed to general unsecured creditors. Overall the article provides critical data and analyses to help policymakers, judges and Chapter 11 par

The number of businesses experiencing financial distress increased significantly during the past several years. The number of Chapter 11 reorganization cases likewise rose. And many of these business failures were spectacular, leaving little value for creditors and even less for shareholders. Consequently, how the business debtor’s limited asset pie is divided and who gets to allocate the pieces are very relevant and important questions. The U.S. Bankruptcy Code generally contemplates the appointment of a committee of the debtors’ unsecured creditors to serve as a fiduciary for all general unsecured creditors and as a statutory watchdog over the debtor and its assets. The creditors’ committee typically includes seven to nine of the debtor’s largest unsecured creditors, and it receives access to much of the debtor’s proprietary and confidential information, as well as a seat at the plan of reorganization negotiation table. Serving as a member of the creditors’ committee often gives a creditor a say in how the asset pie is divided. Whether that creditor uses its committee seat for the benefit of all creditors or simply to further its own agenda is an open question. This Article presents the first in-depth empirical analysis of the activities of creditors’ committees in, and their impact on, Chapter 11 reorganization cases. The primary data examine approximately 296 Chapter 11 cases in six different jurisdictions. This analysis is supplemented by survey data collected from individuals who have served on creditors’ committees or worked as a professional to business debtors or creditors’ committees. The data support several strong associations between the presence of a creditors’ committee and, for example, whether the debtor reorganizes or pursues a sale of substantially all of its assets and the ultimate percentage recovery distributed to general unsecured creditors. Overall the article provides critical data and analyses to help policymakers, judges and Chapter 11 par