Posted On: May 19, 2010
Bankruptcy Judges Support New Disclosure Rules
Investors who trade in distressed debt are balking at possible new disclosure rules that would force them to disclose more information about themselves.From a recent post on the Wall Street Journal’s website:
Distressed-debt investors are fighting an uphill battle right now against new disclosure rules that would shine more light on their trading activity in bankruptcy cases, and if they’re looking for advocates among judges, they’re increasingly out of luck.
U.S. Bankruptcy Judge Robert Gerber, who has overseen some of the most high-profile bankruptcies in recent memory, has been outspoken on the proposed change, calling for broader disclosure rules that would force investors to divulge information they jealously guard.
On Wednesday, a group of his peers weighed in on the controversy, telling a group of lawyers and financial advisers to troubled companies that they, too, back the proposed changes when investor groups want to play a role in a bankruptcy case.
“If you want to come into bankruptcy court, you to tell us who you are,” said Kevin Carey, the chief judge for the Delaware bankruptcy court, one of the most prominent bankruptcy forums in the country. “The judge can’t be kept totally in the dark.”
Carey, joined by three other bankruptcy judges, spoke at the Turnaround Management Association’s spring conference in New York, where they debated several of the hottest issues in bankruptcy today, including the increasingly aggressive tactics used by creditor groups wrangling for bigger recoveries.
On that front, at least, distressed investors who want to take an active role in bankruptcy cases have some friends on the judges’ panel.
“I think that aggressiveness is good,” Rosemary Gambardella, a New Jersey bankruptcy judge. “I think that aggressiveness pays out in the end.”
If you need to information on filing Florida bankruptcy, contact our Jacksonville, Florida bankruptcy law firm.
Greg Gilbert
Keith Maynard
