All posts tagged: Bankruptcy

Photo of Professor Melissa Jacob

Q&A with Professor Melissa Jacoby

In September of 2019, Purdue Pharma LP filed for Chapter 11 protection after facing a wave of lawsuits over its opioid painkiller drug, OxyContin. The Sackler family, who own the pharmaceutical company, have attempted to use a controversial tactic to get bankruptcy-like protections to without filing for bankruptcy in order to protect their personal assets and holdings. On Wednesday, June 15th, according to Bloomberg, “U.S. Bankruptcy Judge Robert Drain approved an investigation into whether the drugmaker’s owners, members of the billionaire Sackler family, have had undue influence on an independent committee of Purdue board members,” a win for the advocacy group of parents whose children died as a result of opioid abuse. Professor Jonathan Lipson, Harold E. Kohn Chair and Professor of Law at Temple Law School, was of counsel to the movant. His colleague, Professor Melissa Jacoby, Graham Kenan Professor of Law at the University of North Carolina at Chapel Hill, put the ruling into context.  Temple Law School: In in the June 15th ruling, Judge Drain approved an investigation, which will give an …

Donald Trump

Bankruptcies Shaped Trump Political Style

Restructuring a failing business requires puffery, threats, gambles and head fakes. Sound familiar? Donald Trump’s campaign for president often seems baffling. That’s because he is playing a very different game from what we expect in general elections. He learned it in bankruptcy proceedings. Having taken his Atlantic City casinos through bankruptcy multiple times, this is a game Trump knows how to play and win — at least for himself, if not necessarily for his companies or others who may depend on him. The process of restructuring troubled businesses such as Trump’s casinos is replete with posturing, table pounding, empty threats, puffery, head-fakes, and the occasional desperate gamble. If all that sounds familiar, it’s probably because you heard it from Trump in this week’s presidential debate. Bankruptcy may be the real model behind his unconventional political behavior. Corporate bankruptcies are complex and contentious affairs. Scores of creditors and shareholders grapple for slices of a pie that is too small to feed all of them. Ordinarily, the expectation is that shareholders will be wiped out, because the company is insolvent, and managers will …

Did Private Equity Firms ‘Strip’ Gambling Empire Caesars Before it Went Bankrupt?

Professor Jonathan Lipson is quoted in this piece by Reuters on a new report due out from a former Watergate prosecutor that could break a deadlock in one of the biggest fights on Wall Street over the bankruptcy of Caesars‘ casino operating unit, Caesars Entertainment Operating. Caesars has proposed injecting $1.5 billion into its operating unit to settle allegations of asset-stripping, and the examiner’s report could show whether or not that amount is fair. But so far junior bondholders have refused to accept Caesars‘ plan, demanding that it inject more money into the bankrupt casino company which would be split into a real estate investment trust and a separate operating unit. Read the Full Story