On Bankruptcy and Mediation
By: Donald L Swanson It happens. There are businesses in financial stress who, for a variety of reasons, can’t qualify for Subchapter V. Owners want to save the business, but Subchapter V is not available. Reasons why Subchapter V might be unavailable include: Debtor has more than $7.5 million of qualifying debt and can’t get enough... Continue Reading →
What is his perspective? (photo by Marilyn Swanson) By: Donald L Swanson Have you ever been in a mediation—or other negotiation context—where one party blows-up in a fit of anger? And wondered about the effect of that moment on the negotiation effort? A 2019 study on "Losing your temper" shows that “anger reduces perspective-taking.” [Fn. 1]... Continue Reading →
Uniformity (photo by Marilyn Swanson) By: Donald L Swanson Bankruptcy courts in 48 of our 50 United States are administered by the U.S. Trustee program; while bankruptcy courts in the remaining 2 states (Alabama and North Carolina) are under the Bankruptcy Administrator program. This has been true since the 1980s. The primary differences in the two... Continue Reading →
By: Donald L. Swanson “By providing you with this notice, [creditor’s name] is merely complying with the notice requirements under the Nebraska Farm Mediation Act. [Creditor’s name] does not, in any way, acquiesce to participation in the mediation process with you.” --Two sentences from a creditor’s notice of mediation rights to a debtor under Neb. Rev.... Continue Reading →
Uniformity (photo by Marilyn Swanson) By: Donald L Swanson The U.S. Constitution requires that bankruptcy laws be “uniform . . . throughout the United States.” Among such uniformity requirements is this: rulings on core bankruptcy issues must be subject to meaningful appellate review—all the way to the U.S. Supreme Court. Explaining this requirement is the dissent... Continue Reading →
The way is paved (photo by Marilyn Swanson) By: Donald L Swanson The parent company of menswear chains Jos A. Bank and Men’s Wearhouse filed Chapter 11 bankruptcy on August 2, 2020. And it achieved a confirmed plan on November 13, 2020. The case is In re Tailored Brands, Inc., Case No. 20-33900 in the Southern... Continue Reading →
Affiliates? (photo by Marilyn Swanson) By: Donald L Swanson "The term 'small business debtor'— . . . (B) does not include—(i) any member of a group of affiliated debtors that has aggregate noncontingent liquidated secured and unsecured debts in an amount greater than [$7,500,000] (excluding debt owed to 1 or more affiliates or insiders)." --11 U.S.C. §... Continue Reading →
A permanent extender? (photo by Marilyn Swanson) By: Donald L. Swanson The Small Business Reorganization Act of 2019 (aka “Subchapter V”) has been in effect since February 19, 2020. And here’s something we’ve learned since then: Subchapter V meets a definite need in our society for helping small businesses and owners in financial stress. I’ve seen... Continue Reading →
The path to confirmation? (Photo by Marilyn Swanson) By: Donald L Swanson 11 U.S.C. § 1191 is Subchapter V’s plan confirmation statute. One confirmation essential, from § 1191(b), is that a Subchapter V plan must be “fair and equitable” to each impaired class that does not accept the plan. This article summarizes two bankruptcy court opinions... Continue Reading →
By: Donald L. Swanson Studying mediation is hard to do—because of confidentiality concerns. One study from decades past, however, gets around the problem. It focuses on a course in the UCLA mediation clinic in which students act as mediators. The study looks at transcripts and recordings of mediation sessions (made with consents of the parties for... Continue Reading →
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