Using In re City of San Bernardino as a springboard, this Note explores both the descriptive and analytic dimensions of a municipality seeking relief from its pension woes within the context of Chapter 9 of the Bankruptcy Code. As a descriptive matter, this Note illustrates that municipalities need alternative solutions to address the growing public pension problem besides issuing municipal bonds. Given the structure of certain public defined benefit pension systems, the strategy of issuing municipal bonds to raise cash has substantial disadvantages. In certain contexts, Chapter 9 of the Bankruptcy Code provides a significantly better alternative. Unlike a business that files for relief under Chapter 11 of the Bankruptcy Code, there are many provisions unique to Chapter 9 that make burdensome pension obligations easier to deal with for a municipality. This descriptive account sets the stage for the Note’s core analytic inquiry: whether the automatic stay suspends a municipality’s obligation to provide funding to a state pension trust; or, in the alternative, whether the suspension of pension obligations to a state pension trust gives rise to “cause” for relief from the automatic stay. This analytic inquiry is structured around the specific arguments set forth in the city of San Bernardino, California’s bankruptcy case.

More In Volume 7 - Issues 1 & 2
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More Burden than Benefit? Analysis of the Benefit Corporation Movement in California | Author: Sarah Thornsberry
The benefit corporation movement has been associated with the separate camps of social entrepreneurship, nonprofit…
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Predatory Hiring as Exclusionary Conduct: A New Perspective | Authors: Richard J. Braun & Michael A. Williams
The showing of predatory or exclusionary conduct is a necessary element to prove an attempted…
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Speak Up: Issue Advocacy in Increasingly Politicized Times I Sally Wagenmaker
This article first provides a brief primer on current constraints affecting Section 501(c)(3) and 501(c)(4)…
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AML in the Spotlight: Compliance Risks for Broker-Dealers and Investment Advisers | Authors: John H. Walsh & Cecilia Baute Mavico
In light of regulators' renewed attention, this article discusses recent events, reviews AML enforcement actions…
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Whodunnit? Divided Patent Infringement in Light of Akamai Technologies, Inc. v. Limelight Networks, Inc. | Author: Mark Tomlinson
This Note provides background information on divided patent infringement in the United States with emphasis…
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Is Internet Radio “Livin’ on a Prayer”? With New Legislation, It “Will Make It, I Swear” | Author: Kelsey Schulz
This Comment discusses whether the IRFA would be the appropriate solution to the inequities in…
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The Shield Act: A Good Attempt at Curbing Patent Trolls that Leaves Us Wanting More | Author: Adina Sivaraman
This Comment explores the SHIELD Act in its entirety. Part II examines the historical background…
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How Courts Can Prevent Excess Emitters From Using Bankruptcy as a Forum to Avoid California AB 32’s Allowance Deductions I Mohammed Tehrani
This paper identifies bankruptcy as a forum in which entities that exceed their emissions limit…
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Reinvigorating the REIT’s Neutrality and Capital Formation Purposes Through a Modernized Tax Integration Model | Author: Simon Johnson
Efforts at reform have not spared the REIT arrangement, but have focused on objectives unrelated…