In previous Alerts, we have addressed the complexities of claims in bankruptcy. Likewise, trading in claims and securities can present challenges. Difficulties have arisen in large Chapter 11 reorganizations as constituencies engaged in the Chapter 11 process, who are major players in the case, seek to trade in securities relating to that case. This Alert explores the impact that some trading activities may have on potential recoveries in the bankruptcy and the help (and impact) of the Internal Revenue Code.

If you hold a claim in bankruptcy by way of a transfer, you may need to be sure the transaction was accomplished by a sale and not merely by an assignment. Yet another decision highlights the growing complexity in bankruptcy claims as we discuss below.

Another court ruling on a missed bar date highlights the importance of ensuring your rights are protected. Failure to comply with a deadline to file a claim can have catastrophic consequences.