Bankruptcy, Restructuring & Commercial Law

Distressed Debt & Claims Trading

The secondary market for distressed debt and claims trading has grown tremendously. Fueled by the past decade’s big bankruptcies, the claims trading market is now a $500 billion industry. Whether you’re a buyer or seller, this can be a significant opportunity for you — albeit a risky one even for those with extensive trading experience. Without legal counsel helping you identify potential issues and moving negotiations along, you risk entering into an unfavorable agreement and wasting time and resources on deals that are never completed or honored.

Our attorneys will identify potential issues and help you expedite an agreement. We know this marketplace and all aspects of transactions relating to distressed debt and the purchase and sale of trade claims. From the negotiation of confidentiality agreements to the negotiation of trade confirmations and purchase and sale agreements, we can anticipate and address your needs. We regularly advise both buyers and sellers to mitigate any misunderstandings. And when disputes arise, our litigators are prepared to assist you.

Quick Facts

  • Multidisciplinary team with bankruptcy and litigation experience
  • Nationally recognized restructuring capabilities
  • Senior attorneys who are leading authorities on claims trading law and have been called upon to provide expert testimony
  • Unique litigation experience handling disputes between inexperienced sellers and members of the claims trading industry
  • Thought leadership provided in publications including the Dow Jones Daily Bankruptcy Review and Law 360

Rankings & Recognitions

  • U.S. News & World Report and Best Lawyers: “America Best Law Firms”
    • Bankruptcy and Creditor Debtor Rights/Insolvency Law:
      - Nationally ranked (2010 – 2012 )
      - Boston (2010 – 2012)
      - New York (2011 – 2012)
      - San Diego (2011 – 2012)
    • Bankruptcy - Litigation
      - Nationally ranked (2011 – 2012)
  • Best Lawyers in America
    • Practice leader included for 25+ consecutive years and named Lawyer of the Year in 2010 and 2013
    • 9 bankruptcy attorneys listed
  • American College of Bankruptcy
    • 4 attorneys are members, and one attorney serves as vice president and chairs its National Education Committee
  • Chambers USA: America’s Leading Lawyers for Business
    • Practice ranked in Massachusetts
    • 6 bankruptcy attorneys listed
    • Practice leader named a Star Individual
  • Massachusetts Super Lawyers
    • More bankruptcy lawyers listed than any other firm in New England
    • 2 bankruptcy lawyers listed in the top 100 lawyers in any field
  • San Diego Super Lawyers
    • Senior bankruptcy attorney ranked (2007 – 2011)
  • New York Super Lawyers
    • Senior bankruptcy attorney ranked (2006 – 2011)
Sort by: Name  Title  Office

Kevin N. Ainsworth

Kevin N. Ainsworth

Member

New York

212.692.6745

Francis J. Earley

Francis J. Earley

Member

New York

212.692.6230

Stuart Hirshfield

Stuart Hirshfield

Senior Counsel

New York

212.692.6771

Ann-Ellen Hornidge

Ann-Ellen Hornidge

Member

Boston

617.348.1657

William W. Kannel

William W. Kannel

Member

Boston

617.348.1665

Dominic J. Picca

Dominic J. Picca

Member

New York

212.692.6859

Paul J. Ricotta

Paul J. Ricotta

Member

Boston
New York

617.348.1752

Precedent-Setting Trade Claims Case

After a trade claim purchase deal went sour, our client, a global manufacturer, terminated negotiations with one investment bank and sold its trade claims to another bank. The first bank then sued our client, claiming that the parties had a binding agreement based upon the draft documents exchanged or, alternatively, that there was a binding oral agreement based upon the customs and practices in the claims trading industry. The case was intensely litigated, including witnesses from across the United States and abroad as well as expert testimony on the industry and its customs. In a decision that now serves as a guide for the operation of trade claim market and the interaction of parties in the industry, a district court granted summary judgment to our client, dismissing claims of breach of contract, breach of the duty of good faith, and fair dealing.

Representative Experience

  • Achieved summary judgment for a multinational corporation in a dispute regarding the sale of certain bankruptcy claims it held in the Delphi Bankruptcy proceeding. The court’s decision in this matter is significant, as it provides a guide for the operation of the multibillion-dollar trade claim market and interaction of parties in this industry. Bear Stearns Investment Products, Inc. v. Hitachi Automotive Products (USA), Inc. and Tokico (USA), Inc., 401 B.R. 598 (S.D.N.Y. 2009).
  • Represented numerous buyers and sellers of claims in the General Motors, Chrysler, Mirant Corporation, Enron, Delphi Automotive, and Lehman bankruptcy cases.

Who We Serve

  • Commercial banks
  • Funds focused on distressed debt
  • Hedge funds
  • Investment banks
  • Private equity funds
  • Trade creditors

  • Dow Jones’ Daily Bankruptcy Review New Fee on Bankruptcy Trades Will Boost Courts’ Revenue Dominic J. Picca is quoted discussing the new fee tied to trades of bankruptcy claims.
  • The Distressed Debt Report Bankruptcies Decrease as Distressed Companies Use Out-of-Court Strategies to Avoid Filing Paul J. Ricotta is quoted discussing bankers' behavior during the current decrease in the number of corporate bankruptcies due to out-of-court restructurings, exchange offers and an "extend and present" posture with lenders.