By Sean McFadden for the Boston Business Journal
With this week’s list, the Business Journal revisits the topic of Bankruptcy Law in Massachusetts after a long absence (scroll to the bottom of this article for the full list). It’s a representative sample, showing a wide range of local firms offering services in this area of law (A number of firms known to offer legal services in the bankruptcy space opted out of participating, including Goulston & Storrs; Morgan, Lewis & Bockius; Holland & Knight; and Sullivan & Worcester).
Among those that did participate, an interesting trend emerged: In a number of instances, the firm’s local bankruptcy practice actually filed a minority of its cases in Massachusetts; instead, they often filed in jurisdictions outside the state. That topic, as well as the impact of Covid-19 and competition in the marketplace, are explored in the comments below that we gathered from several local bankruptcy attorneys.
Doug Gooding, co-chair, business department, Choate Hall & Stewart
What are the major trends your firm’s Mass. bankruptcy practice has noticed over the last year? While our bankruptcy practice is Mass.-based since we are all under one roof at International Place, 95% of the work relates to cases that are filed elsewhere, outside the jurisdiction of Massachusetts. And I think that, with the exception of consumer-related attorneys, you’re going to find that to be true with many firms. This is a development which has occurred over the last 15 years, where cases, even if they’re Massachusetts businesses, are filed elsewhere. There are, by my count, four jurisdictions in the country that get upwards of 90% of the real bankruptcy cases. And that trend has accelerated – certainly over the last year. … The firms that practice primarily on the debtor side, and, to a certain extent, lenders, too, are looking for both predictability in bankruptcy cases and speed. And, it may not shock you to understand that people want to maximize the chances that they’ll get paid. So, rightly or wrongly, these factors have resulted in cases being filed in Delaware; Richmond, Virginia; Houston; and the Southern District of New York. I think that’s unfortunate, because I believe the judges here in Massachusetts are just as qualified and skilled as are the judges anywhere else.
William Kannel, chair of bankruptcy & restructuring practice, Mintz
What are the major trends your firm’s Mass. bankruptcy practice has noticed over the last year? Major trends included the increasing importance and prevalence of pre-bankruptcy restructuring support agreements; the importance of being ‘at the negotiating table’; creditor vs. creditor adversity; and the increasing use of post-bankruptcy litigation trusts.
How does 2020 compare to years past in terms of activity for that practice, particularly in light of the Covid-19 pandemic? 2020 was a unique year for everybody. Our practice was, not surprisingly, very active in 2020 across multiple industries. We expect it to be even busier over the next few years as a clarifying future allows bankruptcy and restructuring solutions to be implemented with an even greater certainty of execution.
Frank Morrissey, partner, Morrissey Wilson & Zafiropulos LLP
As a smaller practice operating in this space, what can you tell me about the level of competition among firms, locally, for bankruptcy-related work, and how are you looking to differentiate yourself?
There is a lot of competition for middle-market business bankruptcy work in this district. And in this competition for bankruptcy clients size matters. My firm competes mostly with larger, ‘State Street’ firms for business bankruptcy work. I bring ‘big law’ expertise and more than 25 years of experience to the bankruptcy matters I handle for clients but without the overhead and overstaffing that often comes with the engagement of larger firms. This is a significant competitive advantage when pitching bankruptcy business to sophisticated consumers of legal services.