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1 Elizabeth C. Wiggins & Patricia Lombard, Assessing the Judicial Work Load Associated with Mega Chapter 11 Cases 1 (1996)

handle is hein.congcourts/asjuworl0001 and id is 1 raw text is: ASSESSING THE JUDICIAL WORK LOAD ASSOCIATED
WITH MEGA CHAPTER 11 CASES
Elizabeth C. Wiggins and Patricia A. Lombard'
Federal Judicial Center
June 10, 1996
Background of Bankruptcy Committee and Federal Judicial Center Activity
Regarding the Mega Chapter 11 Issue
In the 1988-89 Federal Judicial Center Bankruptcy Time Study, one weight was
calculated to represent the judicial time requirements of chapter 11 cases involving one
million dollars or more in assets. Differentiated case weights could not be calculated for
these cases because of limitations in the data that were available at the time of the study.
Specifically, the highest asset category on the standard reporting form was one million
dollars or more. As a result, the weighted caseloads of districts in which numerous very
large chapter 11 cases are filed may underestimate the judicial workload required by their
filings.
An immediate effect of the time study was a decision by the Committee on the
Administration of the Bankruptcy System (Bankruptcy Committee) to create additional
asset and liability categories on the form. Instead of five categories, there are now seven,
with the top three being one million up to 10 million, 10 million up to 100 million, and 100
million or more. This information was needed so that the Bankruptcy Committee and the
courts could track large cases more closely than before and conduct specialized studies of
their management.
The Bankruptcy Committee also asked the Federal Judicial Center (Center) to further
study the judicial time expenditures required by very large chapter 11 cases. Soon after the
Committee's request, the Center attempted to determine the extent to which weighted
caseloads underestimated the judicial work load of districts in which many chapter 11 cases
involving one million dollars or more were filed. The Southern District of New York was
selected for study because it has a relatively large number of such cases.
The Center's review showed that many relatively large chapter 11 bankruptcies came to
the court as a set of filings (e.g., a filing for each subsidiary of a corporate parent) bundled
by the debtors' attorney into a single case. This practice can have a substantial effect on the
weighted caseloads associated with the bundled filings because weighted caseloads are
determined by multiplying each filing by the appropriate case weight based on the reported
assets for that filing. Between 50% and 60% of relatively large chapter 11 filings were
1We thank Gordon Bermant, Hon. Tina L. Brozman (Chief Bankruptcy Judge, S.D.N.Y.), Edward M.
Flynn, Gregory A. Mahin, Cecilia Morris, (Clerk of Bankruptcy Court, S.D.N.Y.), Francis F. Szczebak,
and Hon. David S. Kennedy for their advice on the approach to the analysis, Paul Dickson, Charles
Langlois, Yim Moy Ng and Vito Genna from the Southern District of New York for their efforts in
providing the necessary data, George Cort and Charles Sutelan for their assistance with data analysis, and
Donna Stienstra for reviewing this document.

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