David Arthur Skeel

In the Media: David Arthur Skeel

The Fed, FDIC and Treasury insist taxpayers will no longer be rescuing failing financial firms. But will a new proposal to give the government more power to take over and dismantle firms really end bailouts? Penn Law Professor David Skeel says not likely. (10/29/2009). Marketplace.
The Catholic Diocese of Wilmington is seeking bankruptcy protection in an attempt to manage the potential liability resulting from clergy sexual-abuse lawsuits. Bankruptcy allows an organization to shift from litigation mode to an administrative one in which a mechanism is created for compensating victims, according to David Skeel, a professor of law at the University of Pennsylvania Law School. (10/19/2009). Wilmington News Journal.
“It’s hard to overstate how important it is knowing what they were told by their lawyers,” Penn Law Professor David Skeel said about Bank of America's takeover of Merrill Lynch. “It will make it much easier to isolate who knew what, and who was on board with the decisions, and who wasn’t.” (10/15/2009). New York Times.
"In the absence of obvious, hissable villains and a simple story line, the conventional wisdom [about the current financial crisis] seems to focus more on the crisis itself than on its causes, with the Lehman Brothers bankruptcy now viewed as its pivotal moment," writes Penn Law Professor David Skeel. "The Lehman story line is worrisome for at least two reasons: it threatens to distract attention from the causes of the crisis and the story line itself is deeply mistaken." (10/6/2009). New York Times.
The judge reivewing Bank of America decision to buy Merrill Lynch "sort of sees himself as a voice for public rage, as an outlet for it," says David Skeel, a professor at the University of Pennsylvania Law School . "I think he's responding to the general sense of outrage at what happened in that merger.... He sees these cases as teaching moments." (10/2/2009). The Deal.
A story about Kraft Foods' attempt to buy Cadbury cites research by Penn Law Professor David Skeel showing that the United Kingdom's ban on "frustrating action" clearly makes it easier for a hostile bid to succeed there than in the United States. (9/25/2009). Chicago Tribune.
Congress is seeking details about Bank of America's legal conversations at the end of last year about its coming merger with Merrill Lynch. "What makes it complicated is it’s not just two parties, it’s not just three parties, it’s six or seven parties,” said David Skeel, a law professor at the University of Pennsylvania. “It’s like a multiplayer chess game where each party is making different moves from a different strategic position and each party has a huge amount at stake.” (9/20/2009). New York Times.
Regulators who let Lehman Brothers collapse admit it was a tough ride, but claim it all worked out in the end. Commentator and University of Pennsylvania Law School Professor David Skeel says otherwise. (9/15/2009). Marketplace.
The bankrupt publisher of the Philadelphia Inquirer has run afoul of creditors over its "Keep It Local" campaign, an unusual tactic that appeals to newspaper readers to support insiders' bid for the company. "A question in all this is: Is the object to get the best possible price?" said David Skeel, a professor at the University of Pennsylvania Law School. He said such a campaign in a bankruptcy was highly unusual and compared it to the failed campaign by Britain's Manchester United football club to prevent a takeover by an American investor. (9/4/2009). Reuters.
Merrill Lynch "needs to be in damage control" regarding its $3.6 billion in bonus payouts, said Penn Law professor David Skeel. (8/25/2009). New York Times.
New York City's claim that bankrupt Lehman Brothers owes $627 million in taxes is leading some to question whether the city was lax in pressing Lehman to pay its taxes because Mayor Bloomberg has been a defender of the financial services industry. “It makes you wonder whether there was a wink-wink-nudge-nudge arrangement because of how important Wall Street is to the city,” said David A. Skeel Jr., a professor of corporate law at the University of Pennsylvania. “It may have made sense for the city not to hold the reins too tightly.” (8/4/2009). New York Times.
On the 500th anniversary of his birth, John Calvin is seen by some as contributing to representative democracy and the separation of church and state, writes Penn Law Professor David Skeel. Detractors see Calvin as a dour autocrat obsessed with sin. (7/31/2009). Wall Street Journal.
"What if regulators hadn't bailed out Bear Stearns?" writes Penn Law Professor David Skeel. "If we conduct this simple thought experiment, it raises serious questions about both the conventional wisdom and the Obama administration's new proposals for regulating investment banks and bank and insurance holding companies." (6/29/2009). Weekly Standard.
"The stockholders will likely not get anything" as a result of the Chapter 11 bankruptcy filing by Six Flags them park chain, said David Skeel, who teaches bankruptcy at the University of Pennsylvania Law School. But for customers, "If you are going to Six Flags this summer, there's a very good chance you won't recognize anything different." (6/16/2009). Washington Post.
The "new" Chrysler emerging from bankruptcy won't be liable for product defect claims involving any cars sold before it came into existence. The rights of people who might have claims against a bankrupt company in the future may not be addressed at all. "It ends up getting sorted out in a kind of muddled way," says David Skeel, who teaches bankruptcy at the University of Pennsylvania Law School. (6/10/2009). Business Week.
"I have not yet seen cases that she's decided that really seem to me to give a clear picture of where she's headed," David Skeel, a corporate law professor at the University of Pennsylvania Law School, said about Supreme Court nominee Sonia Sotomayor. "The business decisions seem to me to look like what appeals court decisions look like: relatively straightforward exercises." (6/8/2009). American Banker.
“I’m astonished she even stayed the sale, but I find it quite encouraging, because I find it important that they take a close look at the issues,” David A. Skeel Jr., a law professor at the University of Pennsylvania, said about Justice Ruth Bader Ginsburg's order on Chrysler. “I think it’s a good move. My guess is in the end they will approve the sale.” (6/8/2009). New York Times. Los Angeles Times.
Companies that file Chapter 11 could get stuck in bankruptcy if creditors can't agree on a reorganization plan. "There is always the chance that the case will get bogged down in court, and during that time the business will deteriorate even more," said David Skeel, a professor at the University of Pennsylvania Law School. (6/1/2009). Chicago Tribune.
GM and Chrysler LLC are in a similar position, trying to get their costs in line with those of competitors such as Toyota, noted David Skeel, a professor of corporate law at the University of Pennsylvania Law School. (5/31/2009). Detroit Free Press. USA Today.
"The Obama administration has closely patterned itself on the famous opening year of President Franklin D. Roosevelt’s New Deal," writes Professor David Skeel. "But the plans the administration has rolled out for Chrysler and is now cheering on in the bankruptcy court would make a true New Dealer turn over in his grave." (5/8/2009). The American.
"We’re putting [the Chrysler] bankruptcy judge in the position of really deciding the entire case with the government breathing down his neck," David Skeel, a professor at the University of Pennsylvania Law School, told the Associated Press. “It puts the bankruptcy judge in an untenable position." (5/1/2009). Detroit Free Press. San Francisco Chronicle.
Penn Law Professor David Skeel said the government is basically "quarterbacking the process" in the Chrysler bankruptcy. "What makes this unusual is we're putting a bankruptcy judge in the position of really deciding the entire case with the government breathing down his neck," he said. "It puts the bankruptcy judge in an untenable position." (4/30/2009). Chicago Tribune. Chicago Tribune.
As some law firms defer the start dates of new hires, David Skeel, professor of corporate law at the University of Pennsylvania Law School, says the deferrals are merely symptomatic of deeper shifts underway in the world of big law. He's not convinced deferrals will become an ongoing institutional practice, but he does envision a new layer of entry-level lawyers making a lot less than they do now. (4/28/2009). Philadelphia Inquirer.
Should one or more automakers file for bankuptcy protection, the choice of courthouse can have serious implications, said David A. Skeel, a law professor at the University of Pennsylvania. The Third Circuit, which includes Delaware, had an established court opinion that makes it harder to redo a collective bargaining agreement, a likely sticking point in a G.M. case. On the other hand, he said, the Detroit court is a bit of a “wild card,” having given few signals in substantial cases there of how it would resolve complex issues. (4/26/2009). New York Times.
GM's announcement that it does not plan to make a $1 billion debt payment June 1 is "one more sign that bankruptcy is likely to happen," says Penn Law Professor David Skeel. (4/22/2009). Forbes.
An article about the Obama administration's response to the economic crisis cites a Wall Street Journal op-ed by Penn Law Professor David Skeel and and Wharton School Professor Francis Diebold, in which they wrote that the Lehman bankruptcy was so chaotic primarily because nobody thought the government would actually let Lehman fail. If the government had not bailed out Bear Stearns a few months earlier, the professors wrote, then "Lehman and its buyers would not have played chicken with the Fed and Treasury as they did, holding out for a government guarantee of the sales of Lehman's assets." (4/20/2009). National Review (subscription).
The law firm Weil, Gotshal & Manges is seeking $55 million for its work handling Lehman Brothers' bankruptcy. David Skeel, a bankruptcy-law professor at the University of Pennsylvania, said the fees paid to top firms are often worth the results they deliver. "Weil did great work in Enron," he says. "It started in complete chaos, but in the end, creditors got a decent recovery." (4/16/2009). Wall Street Journal (subscription).
As lawyers for General Motors consider a possible bankruptcy filing, and doing so in New York, it may be difficult for them to justify filing in a court outside of GM's home city and state of incorporation. "If they file in New York they will have to take some punches. It will set off at least a temporary firestorm," said David Skeel of the University of Pennsylvania Law School, who is also an expert on the history of bankruptcy. (4/7/2009). Forbes. Reuters.
Penn Law Professor David Skeel's history of bankruptcy, his book Debt's Dominion, is cited in an article about the essential roles of failure and bankruptcy in capitalism. (4/2/2009). Wall Street Journal.
The government’s plan to dictate terms as the provider of G.M.’s bankruptcy financing is not without risk. “You’re introducing politics into the process,” David A. Skeel, a law professor at the University of Pennsylvania. “The hope is that if we call it a controlled bankruptcy, that’s what it will be.” (4/1/2009). New York Times.
"I don't see it as a few-week thing," David Skeel, a bankruptcy law expert at the University of Pennsylvania's Law School, says about a General Motors bankruptcy. "GM is not a classic in-and-out type of company." (3/31/2009). Forbes.
During economic downturns, “We run roughshod over some contracts and not over others,” said David A. Skeel, a law professor at the University of Pennsylvania. “Right now, employment contracts seem to be the type of contract that is viewed as eminently rewritable.” (3/30/2009). New York Times.
"Extending the FDIC's authority, in conjunction with Treasury and the Fed, to include investment banks and other financial institutions is being sold as a small and pragmatic step. In reality it is a big step, and that big step would be a big mistake" write Penn Law Professor David Skeel and Wharton School Professor Francis Diebold. (3/27/2009). Wall Street Journal.
The political furor over bonuses paid by A.I.G. might put at risk the longer-term need to change the financial system. "The political gamesmanship is going to make it a lot more complicated," said Penn Law Professor David Skeel. (3/20/2009). Philadelphia Inquirer.
Worries about extensive damage to the financial system if AIG is allowed to fail might be overblown. Penn Law Professor David Skeel says the U.S. government can simply step in and guarantee the key trades among counterparties. "I think the claim that the sky will fall if the company winds up in Chapter 11 is generally unfounded," he says (3/19/2009). Forbes.
All parties involved in the bankruptcy filing by the owners of Philadelphia's major newspapers might be forced to wait until business conditions improve, with the hope of eventually salvaging everyone's investment, said David Skeel, a law professor at the University of Pennsylvania and an expert on bankruptcy. (2/25/2009). Philadelphia Inquirer.
Law Professor David Skeel joined President Amy Gutmann and scholars from around the University on Feb. 17 to discuss causes of the current economic downturn and what can be expected moving forward. (2/17/2009). C-SPAN.
With the Chicago Tribune declaring bankruptcy, its employees are particularly vulnerable because they also own all the company's stock. Shareholders are last to be paid in bankruptcy, and they often end up with nothing. "That's a huge hit," said David Skeel, a bankruptcy professor at the University of Pennsylvania law school. "That will no doubt be the subject of much discussion in this case." (12/9/2008). China Daily.
Chapter 11 bankruptcy traces its roots to the rescure of the railroads in the 1800s. "The investment banks and lawyers and managers would negotiate a deal and get the courts to bless it," says David Skeel, a law professor at the University of Pennsylvania and author of Debt's Dominion: A History of Bankruptcy Law in America. "It was a very flexible reorganization process." (11/25/2008). Time.
Professor David Skeel discusses complications from credit default swaps in Lehman Bankruptcy (9/17/2008). ABA Journal.
Lehman Brothers' Chapter 11 filing is "a weird case because ordinarily you think of bankruptcy as giving you breathing space - it's not clear it will here," said Professor David Skeel. (9/16/2008). Forbes.
David Skeel of the Law School comments on Countrywide Financial’s outlook. (9/2/2008). Forbes.
Speaking about the hedge fund firm Elliott Associates, “Elliott's actions are amoral,'' says Professor David Skeel. ``They've taken a number of actions designed to make a profit, without worrying about the potential consequences for the country involved.'' (1/7/2008). Bloomberg .
Professor David Skeel’s co-authored paper about collateralised debt obligations (CDOs) is cited in an explanation of the recent run on the British bank Northern Rock (9/20/2007). The Economist .
Professor David Skeel says the San Diego Diocese bankruptcy case “could be a really nasty process” in addressing the sexual abuse charges (9/6/2007). The Guardian .
Professor David Skeel addresses the IRS' formulaic approach to setting debtors expenses that does not account for regional cost differences. ABA Journal (1/26/2007).
Professor David Skeel discusses the number of bankruptcy petitions filed nationwide. Atlanta Journal Constitution (12/29/2006). Article.
Professor David Skeel and his co-author "point out that the banks that financed Enron's debt used massive amounts of credit derivatives to limit their own risk of the company going into default." The Wall Street Journal (11/20/2006).
Professor David Skeel addresses the crisis in equity funds in an Op-Ed in the Financial Times. (9/5/2006). Article - Requires Westlaw sign on - Citation #2006 WLNR 15381460.
Professor David Skeel discusses Xybernaut's bankruptcy and "that a properly functioning board of directors should have a sense that something is going wrong" in an article about Senator George Allen's role as a board member. The American Prospect (9/1/2006).
Professor David Skeel discusses how credit derivatives may precipitate a flight to safety and perhaps a financial crisis. Financial Times. (7/17/2006). Article - Requires Westlaw sign on - Citation #2006 WLNR 12272749 .
Professor David Skeel suggests that with regulation hedge funds should be made more accessible to ordinary investors and not just the super rich. National Public Radio: Marketplace. (7/4/2006). Audio.
Professor David Skeel predicts that it will "be difficult for the SEC to get back on track" after the recent court decision to disallow the hedge fund manager registration requirement. NPR: Marketplace. (6/23/2006). Article.
In an Op-Ed in the Philadelphia Inquirer, Professor David Skeel discusses how school vouchers might help the religion-science debate evolve. (4/14/2006). Article.
Professor David Skeel discusses in a commentary Financial Times how an innocent verdict for Mr. Lay and Mr. Skilling would actually lead to more reforms than a guilty verdict. (4/10/2006). Article - Requires Westlaw sign on - Citation #2006 WLNR 6009016.
The N.Y. State Society of Certified Public Accountants awards Professor David Skeel its "Excellence in Financial Journalism Award" for his article "Behind the Hedge" in Legal Affairs Magazine. (4/3/2006).
Professor David Skeel describes the filing of an involuntary bankruptcy case in the Jeff Prosser telecom case. The Daily Deal (2/27/2006). Article - Requires Westlaw sign on - Citation #2006 WLNR 3260454..
Professor David Skeel contributes his strategy for the prosecutors in the Enron case, including sharing with the jury that "several of the witnesses themselves were participants." Knowledge@Wharton (2/9/2006).
Professors Nathaniel Persily and David Skeel both predict that Chief Justice John Roberts and Samuel Alito would favor business. Business Week (1/1/2006).
Professor David Skeel addresses the broader implications of the federal bankruptcy court's decision regarding the sexual abuse case in the Catholic archdiocese in Oregon. The Wall Street Journal (12/31/2005).
Professor David Skeel addresses the broader implications of the federal bankruptcy court's decision regarding the sexual abuse case in the Catholic archdiocese in Oregon. The Wall Street Journal (12/31/2005).
Professor David Skeel comments that "the church has taken inconsistent positions on ownership in the past" in selecting the Diocese or individual parishes. The Guardian (12/6/2005). Article.
Professor David Skeel describes the relationship between credit cards and the increased U.S. bankruptcy rates. Scientific American (12/1/2005). Article.
Professor David Skeel finds his original reaction expecting few ripples to the Refco failure "less plausible." Chicago Tribune (11/9/2005). Article - Requires Westlaw sign on - Citation #2005 WLNR 18126432.
Professor David Skeel explains how "Bankruptcy is the default solution to numerous social problems in this country." Fortune (10/17/2005). Article - Requires Westlaw sign on - Citation #2005 WLNR 16004796.
"The way that Delphi is handling its bankruptcy shows how things have changed," says Professor David Skeel. "... companies are supported - and controlled - with specialist financing and managers are given very large financial incentives to act rapidly and to take tough decisions." Financial Times (10/13/2005). Article - Requires Westlaw sign on - Citation #2005 WLNR 16567122.
On the Spokane ruling that permits all church diocese assets to be used to settle abuse lawsuits, Professor David Skeel comments that this provides abuse claimants with "a major card here that enormously increases their leverage." The Chicago Tribune (8/28/2005).
Professor David Skeel comments about the proposed Federated and May department stores merger, "The market is worried about retailers generally, but here's a chance to build a truly national brand. It's a gamble, but it looks like a merger that could actually work." The Chicago Tribune (8/7/2005).
In a commentary Professor David Skeel and co-author John Armour discuss the differences between the U.S. and British takeover regulations and the relevance to emerging economies both in Europe and elsewhere in the world. Financial Times (6/18/2005).
Professor David Skeel comments that the Tyco convictions were less about the company's own finances than the narcissistic exploits of two top executives, saying "...it was a case of directly feeding from the trough, stealing from the company." Chicago Tribune (6/18/2005).
Jurors are apt to find e-mails more believable than formal legal documents since they are often informal or provocative in tone and "can have an inflammatory quality," says Professor David Skeel. The Philadelphia Inquirer (5/27/2005).
Professor David Skeel discusses the new bankruptcy law: how filing will become more costly and more of a hassle, how attorneys will have to verify the accuracy of the filing, and how it might affect credit card companies. National Public Radio (5/6/2005). Article.
Professor David Skeel "argues that forces such as risk-taking and competition, qualities such as self-confidence, visionary insight and the ability to 'think outside the box' are precisely the ones that lead companies astray." The Age (4/27/2005). Article.
Professor David Skeel points to Supreme Court decision around the same time as the 1978 last major bankruptcy reform, saying that it also contributed to the "weakened usury laws and ushered in the era of widespread unsecured consumer borrowing." The Economist (4/15/2005).
Professor David Skeel argues that MCI in "selling itself to Verizon -- and not to the far weaker Qwest -- MCI is setting into motion a prudent long-term plan." The New York Times (4/10/2005). Article - Requires Westlaw sign on - Citation #2005 WLNR 5597894.
In a review of Professor David Skeel's new book, Icarus in the Boardroom, The Washington Post says that the book "convincingly highlights deep problems yet to be resolved with the current system of investor protection." (4/3/2005). Article.
Professor David Skeel describes the changes in the kinds of people filing for bankruptcy in The New York Times "Week in Review" (3/13/2005).
Professor David Skeel discusses the possibility of Bernard Ebbers filing for personal bankruptcy as he had most of his wealth in WorldCom stock. The Wall Street Journal (2/23/2005). Article - Requires Westlaw sign on - Citation #2005 WL-WSJ 59841763.
The Financial Times describes Professor David Skeel's new book, Icarus in the Boardroom, in a Op-Ed as putting "the analysts story in context, as part of a wave of innovation and risk-taking." (2/13/2005).
Professor David Skeel describes in an Op-Ed how Bernard Ebbers of WorldCom, Richard Scrushy of HealthSouth Corp, and Kenneth Lay of Enron have turned to faith as their defense in their criminal trials for ethical failues. The Chicago Tribune (2/8/2005).
In the recent American Business Financial Services filing for bankruptcy protection, Professor David Skeel recognizes the importance of restoring a lenders reputation, acknowledging that "it's very hard for them to get back on their feet." The Philadelphia Inquirer (1/21/2005).
Professor David Skeel discusses innovative public methods for making directors accountable to shareholders. American Public Media: Marketplace (1/18/2005). Audio.
Professor David Skeel's new book, "Icarus in the Boardroom: The Fundamental Flaws in Corporate America and Where They Came From," is included in a discussion on recent corporate governance books. The Deal.com (1/17/2005). Article - Requires Westlaw sign on - Citation #2005 WL 63111653.
Professor David Skeel explains on APR's Marketplace in a significant case before the U.S. Supreme Court how difficult it may be for investors to prove that public company statements caused them to lose money. (1/11/2005). Audio.

In the Media: David Arthur Skeel

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