• Same Issue + Different Reasoning = Same Result
  • October 25, 2011
  • Law Firm: Burr & Forman LLP - Birmingham Office
  • Recharacterization of claims as equity rather than debt is a common issue in recent bankruptcy cases, but it is analyzed differently across the Burr & Forman LLP footprint. The critical question is: Does the method of analysis really matter? Likely not. One 3rd Circuit opinion put it this way in discussing various tests for recharacterization: "While these tests undoubtedly include pertinent factors, they devolve to an overarching inquiry: the characterization as debt or equity is a court's attempt to discern whether the parties called an instrument one thing when in fact they intended it as something else."