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Prepacks Post Filing

Judge Robert Drain discussed the history and mechanics of pre-packaged Chapter 11 cases. He explained that pre-packaged plans, authorized since the 1978 bankruptcy code, allow debtors to file a restructuring plan with their initial petition. Drain highlighted key sections like Section 1120(6)(b) and Rule 3018(b), which govern pre-petition solicitations. He noted that these plans are most effective when debtors have too much funded debt and need to reduce it through equity. Drain also emphasized the importance of compliance with non-bankruptcy laws and the potential for rapid pre-packaged cases, which can be confirmed quickly to preserve trade credit and business value.

Tags:
Keywords:

pre-packaged chapter 11, bankruptcy, funded debt, creditors committee, disclosure, solicitation, rapid pre-pack, unimpairment, executory contracts, due process

Duration:

32 minutes 40 seconds

Hon. Robert D. Drain is Of Counsel with Skadden, Arps, Slate, Meagher & Flom LLP in New York
and previously served for 20 years as a U.S. bankruptcy judge for the Southern District of New York,
presiding over many impactful business and consumer cases. Before retiring from the bench in 2022,
Judge Drain oversaw proceedings ranging from large chapter 11 corporate restructurings — including
Loral, RCN, Cornerstone, Refco, Allegiance Telecom, Delphi, Coudert Brothers, Frontier Airlines, Star
Tribune, Readers Digest, A&P, Hostess Brands, Christian Brothers, Momentive, Cenveo, 21st Century
Oncology, Tops, Global A&T, Sears, Full Beauty Brands, Sungard, Windstream, Purdue Pharma, Jason
Industries, OneWebb and Frontier Communications — to chapter 15 and other cross-border cases, such
as Varig, S.A., Yukos (II), SphinX, Galvex Steel, TBS Shipping, Excel Maritime, Nautilus, Landsbanki
Islands, Roust and Untrapetrol. He also served as a court-appointed mediator in numerous cases, in-
cluding New Page, Cengage, Quicksilver, Advanta, LightSquared, Molycorp, Breitburn Energy, China
Fishery and PREPA. In his current practice at Skadden, Judge Drain advises on U.S. and cross-border
chapter 11 and 15 reorganizations and litigation, out-of-court restructurings, distressed M&A and invest-
ments in troubled companies, debtor-in-possession loans and exit financings, as well as potential exam-
iner or trustee roles and mediations. He is a Fellow of the American College of Bankruptcy, a member
and former ABI board member, and a former board member and officer of the National Conference of
Bankruptcy Judges (NCBJ). He was chair for several years of the Bankruptcy Judges Advisory Group
established by the Administrative Office of the U.S. Courts, has testified before the Senate Judiciary
Committee on home mortgage loss mitigation, and currently serves on the FDIC’s Systemic Resolu-
tion Advisory Committee. Judge Drain was a founding member and chair of the Judicial Insolvency
Network, which developed, among other issuances, guidelines that were adopted by courts in the U.S.
and abroad for cooperation and communication in concurrent transnational insolvency cases. He also
has long annually presided over a mock transnational bankruptcy case for the International Association
of Restructuring, Insolvency & Bankruptcy Professionals’ (INSOL’s) training program and is a member
of the International Insolvency Institute. In addition, he is a member of the Business Bankruptcy Com-
mittee of the U.S. Bankruptcy Court for the Southern District of New York. Judge Drain is an adjunct
professor at Pace University School of Law and a former adjunct professor in St. John’s University
School of Law’s LL.M. in Bankruptcy Program. He has contributed to treatises on bankruptcy law and
frequently lectured on bankruptcy law in multiple programs for the Federal Judicial Center, NCBJ,
ABI, AIRA, Turnaround Management Association, Practising Law Institute, American College of Bank-
ruptcy, International Insolvency Institute, Federal Bar Council and Columbia University School of Law,
and national, international and local bar associations, as well as judicial and professional interchanges
with judges and practitioners in South America, Europe, China, South Korea, Singapore and India. Prior
to his time on the court, Judge Drain spent nearly 20 years in private practice, including 10 years as a
partner in the bankruptcy and restructuring practice of another global law firm. He also authored a novel,
The Great Work in the United States of America. Judge Drain received his B.A. cum laude from Yale
University and his J.D. from Columbia University School of Law, where he was a Harlan Fiske Stone
Scholar for three years.

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