NEW YORK ( The Deal) -- In the minds of many, Lehman Brothers' collapse and subsequent bankruptcy has served as a turning point in the country's financial landscape.
And while five years have gone by since the epic Chapter 11 filing on Sept. 15, 2008, its influence remains strong. For example, the movement behind the possible creation of a Chapter 14 of the U.S. Bankruptcy Code that would just be for financial institutions is a direct response to Lehman.
Meanwhile, the Lehman petition was clearly the impetus behind at least one piece of legislation, the Dodd-Frank Wall Street Reform and Consumer Protection Act, designed to improve accounting transparency among financial institutions and prevent future taxpayer bailouts of them.
Less clear is how "the skinniest Chapter 11 petition in history," as debtor counsel Harvey Miller of Weil, Gotshal & Manges LLP called it recently, inspired the speed at which bankruptcy sales were done in the cases of General Motors (GM) and Chrysler, which filed within two months of each other in the spring of 2009 and were sold in as lightning-quick a fashion as Lehman's North American investment bank and brokerage assets.Without question, general market turmoil, an economic freefall and widespread mistrust of the big banks and the regulators tasked with overseeing them followed the brokerage's implosion. "
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