Redefining Extraordinary Circumstances in the Wake of COVID-19: Finding Consistency in Difficult Times
April 22, 2020
Authored by: Andrew Schoulder, Jason DeJonker and Chelsey Rosenbloom
Editor’s Note: This was originally published in CFO.com on April 21, 2020.
Humanity has largely embraced the “we are in this together” mentality from a health crisis perspective. Yet, even as world leaders scramble to contain the COVID-19 pandemic, we have yet to fully grasp the follow-on impact from the pandemic and particularly, how it will affect world economies. For this “second phase” of the world’s response to the pandemic, the ultimate question is whether business and financial counter-parties will equally share the risk of loss. Bankruptcy judges have jurisdiction to fashion remedies for parties in their courtroom, but Congress and COVID-19 have left them no choice but to rule on issues immediately in front of them without the ability to limit the impact of their decisions on other market players. With a goal of tempering the COVID-19 related damage, recent difficult decisions in U.S. Bankruptcy