Date of Award

Spring 5-1-2015

Degree Type

S.J.D. Dissertation

Degree Name

Doctor of Juridical Science (S.J.D.)

Abstract

This paper uses a multivariate logistic regression model to examine empirically and quantify for the first time the effect of the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) on the Chapter 11 landscape. Two samples are tested: a general sample consisting of firms from various corporate sectors, and a sample consisting only of retailers. Both studies show that the 2005 amendments had a statistically significant effect on traditional Chapter 11 practice. In particular, post-BAPCPA we observe a rise in rapid dispositions through the form of a sale of all or substantially all debtor assets. Indeed, in the post-amendments era, debtors are increasingly using § 363 of the Bankruptcy Code to exit Chapter 11 within a few months after filing for bankruptcy. Now debtors do not spend time negotiating with their creditors to write down debt, but instead seek a strategic buyer at the outset of the case, or liquidate in the early stages of the Chapter 11 proceedings. This trend can be attributed to certain 2005 provisions that have the effect of depleting the debtor of the two elements most necessary for a lengthy case: money and time.

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