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Lynn M. LoPucki
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Ebenezer, the equitable tracing rule Bob is referring to is the "lowest intermediate balance rule." If the bitcoins went into the recipient's account they are in it permanently to the extent of the lowest later balance in the account. A drug dealer can periodically empty the account and that will take care of the problem. But legitimate business people -- even John Galt -- aren't going to want to be bothered with hiding the currency they use.
Astezar, consider the example of the bakery and the supplier. After the bank calls the bakery's loan and gets a judgment against the bakery, it conducts discovery to see where the bakery's bitcoins went. The bakery will be compelled to testify as to the identity of the supplier. Then the supplier will be compelled to testify as to the present contents of the supplier's bitcoin account. If the supplier fraudulently transfers the coins before the bank can seize them, the supplier is liable to the bank -- in real dollars.
Aspen's warehouse date for the VisiLaw Marked Edition is August 8, 2012. The same statutes appear in both versions, making it possible for students to use whichever version they prefer.
I don't think short case duration is a goal in an of itself. If it reduces the direct or indirect costs of bankruptcy (which it seems to) or increases the likelihood of firm survival (it seems to do the opposite) those would be the indicia of success.
Kmart filed in 2002 and confirmed its plan in 2003. Since 2003, seventeen large, public companies that were headquartered in Chicago filed bankruptcy. Three chose to file in Chicago (18%). You can run this search for any city on the WebBRD at http://lopucki.law.ucla.edu.
Toggle Commented Feb 17, 2010 on Chapter 11 Filing Data Are Noisy at Credit Slips
1. I don’t think the idea that courts have been competing for big bankruptcy cases is controversial. Nearly every big city bankruptcy court revised its rules in response to Delaware’s surge of the mid-1990s. Some courts stated publicly that they were making changes to stop the outflow of cases to Delaware. 2. Delaware is clearly winning the competition for big cases. Yet, as Bob correctly points out, on this issue the Houston Court’s decision is more favorable to the case placers than the Delaware Court’s decision. Such an inversion is interesting, but hardly unusual in regulatory competitions. For example, Delaware remains the leader in the corporate charter competition even though it's court decisions are less favorable to management on a number of legal points. All Delaware has to do in both competitions is to remain sufficiently more favorable on the entire array of issues that it doesn’t lose significant numbers of cases to other courts. So far, it is doing that. You can watch the flow of cases to particular courts on the WebBRD at http://law.ucla.edu. 3. Whether malicious or in good faith, court competition is sapping the regulatory power of the bankruptcy courts, just as it sapped the regulatory power of corporate law. If you don't think parties should be free to contract around the bankruptcy system, you should be worried.
I don't think any of us are wasting our time in continuing the Delaware debate. Delaware is the key to understanding the failure of the bankruptcy system in the context of large, public companies. Reorganization failure rates have been sky high, dozens of companies have been sold at prices only half what they would have brought in reorganization, professional fees are out of control, and cases are processed thousands of miles from where the creditors and employees are located. Our job is to discover the truth even when we can't change the world.
Toggle Commented May 24, 2007 on Why Think About Delaware? at Credit Slips