The priority structure of debt claims against business entities is a key feature of corporate finance. The American Bankruptcy Institute's Commission to Study Reform of Chapter 11 recently recommended that U.S. bankruptcy law grant junior, out-of-the-money creditors a distribution in the...

This paper explains a function of the legal boundaries of various organizations (such as corporations, security interests and trusts): they define internal capital markets within which capital may be redeployed over time by fiat and over which it may be moved only at greater cost and with...

This paper explains a function of the legal boundaries of various organizations (such as corporations, security interests and trusts): they define internal capital markets within which capital may be redeployed over time by fiat and over which it may be moved only at greater cost and with...

This paper examines common arrangements for separating control from cash flow rights: stock pyramids, cross-ownership structures, and dual class equity structures. We describe the ways in which such arrangements enable a controlling shareholder or group to maintain a complete lock on the control...

This chapter is forthcoming in an edited research handbook on corporate bankruptcy law. It reviews the theoretical and empirical scholarship on debtor-in-possession (DIP) financing, particularly as it bears on the more controversial features of DIP loans: financial terms such as...

The combination of cost-cutting pressures and technology advances are triggering a major transformation of the core practices of business law. Developments in automated contract drafting and management have spurred the entry of low-cost competition, beginning with the production of standardized...

Economic contract theory postulates two obstacles to complete contracts: high transaction costs and high enforcement (or verification) costs. The literature has proposed how parties might solve these problems under a stylized litigation system, but it does not address the question of how parties...

Covenants not to compete (CNCs) are used in employment contracts to prevent employees from working for other employers. The legal enforcement of CNCs varies across jurisdictions in the U.S.: some states ban them (notably, California), while a majority of states enforce CNCs when they reasonably...