Bankruptcy is a better alternative
Article Abstract:
Creditors are wrong to fear that Chapter 11 bankruptcy serves them less well than collecting under state law. It is crucial to distinguish those losses that happen because of a business failure and those due to the bankruptcy system. Chapter 11 is more helpful to unsophisticated creditors and those without enough market share to price goods so as to compensate for the risk of business failure. Chapter 11 seeks to even the odds among creditors, whereas state collection law favors some kinds of creditors over others.
Publication Name: The National Law Journal
Subject: Law
ISSN: 0162-7325
Year: 1992
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How Chapter 11 sees dissenting classes
Article Abstract:
The Bankruptcy Reform Act of 1978 enacted Chapter 11, which emphasizes negotiation of reorganization plans. The emphasis on consensus means that the treatment of dissenting classes can be problematic. Classes of claims considered unimpaired and those holding executory contracts are excluded from the confirmation process altogether. Other dissenting individuals or classes have recourse to the best-interests test, or the plan may be confirmed with a cramdown.
Publication Name: The National Law Journal
Subject: Law
ISSN: 0162-7325
Year: 1992
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Provision can cancel tax benefit; debtors' trap?
Article Abstract:
Corporate reorganization plans must be carefully formulated to avoid the pitfall of Bankruptcy Code section 1129(d), which denies the tax benefits of section 1146(c) if the primary purpose of a reorganization plan is deemed to be tax avoidance. The cases of Gregory v Helvering and In re Rath Packing Co have been the salient ones decided in this area.
Publication Name: The National Law Journal
Subject: Law
ISSN: 0162-7325
Year: 1992
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- Abstracts: Tax Court upholds accelerated deduction for vacation and severance benefits funded by irrevocable letter of credit
- Abstracts: Market power as a screen in evaluating horizontal restraints. The reform of the European competition policy concerning vertical restraints
- Abstracts: Stock acquisitions and liquidations by S corporations: availability of benefits afforded by sections 332 and 338
- Abstracts: The mediation alternative in sex harassment cases. The role of mandatory arbitration for financial institutions
- Abstracts: Market power and the National Association of Attorneys General Horizontal Merger Guidelines. The growing judicial acceptance of the merger guidelines