- Home »
- Fiduciary Duties / Directors
Fiduciary Duties / Directors
Understand what the “in pari delicto” defense is and how it can be used in a bankruptcy proceeding to protect yourself.
TPLF represents billions in litigation investing. Litigation funding in the US rose to $2.8 billion last year — $17 billion worldwide. Read about ethical risks looming large.
The borrower is an LLC managed by a greedy principal member. The borrower slowly pays the secured creditor and unsecured creditors over years and its business becomes insolvent. The insolvent LLC makes cash distributions to its members, but not to the secured creditors. Is there a law against this sort of behavior?
Examining the “Fiduciary for Hire” and the NRA’s Bad Faith Bankruptcy “When in doubt, mumble, when in trouble, delegate, when in charge, ponder.” – James H. Boren, When In Doubt, Mumble: A Bureaucrat’s Handbook (1972) Business entity debtors in chapter 11 cases come in all shapes and sizes, with varying degrees of integrity and competence in managing those entities. Debtor’s professionals, while arguably also fitting those parameters, must play the cards they are dealt—usually in financially urgent circumstances—and make real-time strategic decisions with real-world consequences. When questions arise as to […]
How to Develop Board Committees Equipped for a New Landscape As Covid induced bankruptcies proliferate, creditors who become stockholders will need to focus not only on the future financial health of the reorganized company, but also on its overall governance. The new post-pandemic landscape will be revolutionary, not evolutionary. It will demand new owners and advisors to construct a multi-talented board, capable not only of reacting quickly and intelligently to dislocations and threats, but more importantly, to crafting a strategy that positions the new company as a leader in its […]
An Introduction to the Distressed Company’s Superman: The Chief Restructuring Officer The role of a Chief Restructuring Officer (“CRO”) is approximately four decades old. While still a somewhat new role in the 1990s, CROs are now ubiquitous in the restructuring community. Todd Zywicki, a George Mason law professor who specializes in bankruptcy law, traces the origin of the CRO to the Bankruptcy Reform Act of 1978 (the “1978 Act”). The 1978 Act created “a unified reorganization chapter [chapter 11] that is fundamentally grounded in the presumption that pre-bankruptcy management will […]
How Can Special Committees Influence Your Bankruptcy? The appointment of independent directors may benefit a financially distressed business throughout its restructuring process, including during a bankruptcy case. An outside voice can guide a company through the process while fending off claims of conflict of interest by the court. What is an Independent or Non-Executive Director? An independent director can be conceived of as having no direct or indirect connection to the business, including not being an employee, owner, or other insider of the business, and not deriving any income from […]