Bankruptcy Deals Decried by Workers Get High Court Review

[Purveyor]

Source: Bloomberg

The U.S. Supreme Court will review a bankruptcy strategy that lets select creditors jump the repayment line, sometimes at the expense of parties otherwise be entitled to some recovery.

The dispute taken up by the court involves “structured dismissals,” in which a company agrees to pay off one group of creditors but not others that have the same priority. The bankruptcy is then dismissed.

The practice has drawn fire from scholars, consumer advocates and more than a dozen states, which claim it can allow companies to skirt tax claims.

Jevic Holding Corp., a trucking company, used the technique to ensure that some lawyers who worked on its Chapter 11 case got paid even though drivers who had the same priority were not. The drivers had claimed damages over their mass firing when the company filed for bankruptcy.

Read more: http://www.bloomberg.com/politics/articles/2016-06-28/u-s-high-court-takes-case-on-strucutrued-bankruptcy-dismissals

[groundloop]

1. It's the American way - Fuck the working class

Corporate bankruptcy is nothing but legalized stealing, now the courts are making it even easier for working men and women to get screwed over. With a 4-4 split on the Supreme Court this decision has little chance of being overturned.

[Fresh_Start]

2. I think the rule is a bit different

its more like the lawyers get paid first

[groundloop]

3. Yes... lawyers get paid first, screw the drivers

[laserhaas]

4. Pre bankruptcy petition lawyers are unsecured creditors

Attorneys at law working the case are senior priority administrative claims.

Otherwise...no one would work the cases.

The SCOTUS ruling will be a neat thing to see

[TexasMommaWithAHat]

5. Screw the working class.

There's gonna' be a revolution...