Privatizing Ethics in Corporate Reorganizations

Abstract:     
This Article highlights the increased presence and influence of managers who are hired as a result of creditor demands - that is, privatized trustees. These creditor-controlled private trustee increasingly are performing duties and holding roles traditionally associated with a public, statutorily authorized trustee. This Article considers how ethical and fiduciary duties should be constructed and then imposed on the people who control firms in bankruptcy. The Article ultimately concludes that privatized trustees should have the same ethical obligations and duties in bankruptcy cases as the duties the Bankruptcy Code imposes on public, statutorily authorized trustees.

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