Unjust Debts: How Our Bankruptcy System Makes America More Unequal

“The federal Bankruptcy Code intersects with the lives of more people in the United States than virtually any other law does,” asserts UNC law professor Jacoby in her startling debut exposé. She reveals that what began as an opportunity for “honest but unfortunate” debtors to make a fresh start has transformed over the decades into a legal Swiss army knife used to shield corporations, governments, and the very wealthy from the consequences of their actions. For example, to avoid liability for the Sandy Hook massacre, Remington went bankrupt, which allowed them to sell the company to a buyer not required to provide compensation for the harms caused by Remington’s business practices. Bankruptcy protections were also obtained by corporations on the hook for the opioid crisis, by Harvey Weinstein’s production company when it wanted to dodge paying damages to sexual assault victims, and even by municipalities seeking to evade paying damages for civil rights violations committed by racist cops. Meanwhile, the system’s inequity is exacerbated further by racial disparities; as one study has shown, Black couples are more likely to be funneled into a more costly and difficult bankruptcy process. Jacoby’s assured prose brings extraordinary clarity to an intentionally opaque and labyrinthine system. It’s an eye-opening look at the laws that undergird American inequality. (June)