Elite Bankruptcy

“The influence of bankruptcy lawyers over bankruptcy law seems almost inevitable.” —David Skeel In Debt’s Dominion, David Skeel wrote that bankruptcy professionals have played a key role in shaping U.S. bankruptcy law. He predicted that these professionals would continue to shape the bankruptcy process long into the future. Today, we can see that Skeel’s prediction has come true. Although Congress has yet to overhaul the Bankruptcy Code, bankruptcy professionals have succeeded in their own form of overhaul by creating what this Essay calls “elite bankruptcy:” a type of bankruptcy accessible only to the rich and powerful. Elite bankruptcy is practiced only in pockets of the country and by a relatively small group of law firms and judges. Elite bankruptcy tackles some of the most complex issues of the day and allows lawyers and judges to exercise their creativity in addressing those issues. Elite bankruptcy has even provided bankruptcy professionals with the opportunity to influence other areas of law. This Essay explores how bankruptcy professionals created elite bankruptcy and analyzes the consequences of elite bankruptcy’s existence. Is elite bankruptcy a successful product of the bankruptcy system’s natural creativity and flexibility, or is it a failure of the system and its guardrails? This Essay seeks to unpack that question and, in doing so, it continues Skeel’s important work in understanding how bankruptcy professionals shape the law.