This morning I filed an amicus brief in support of the mandamus petition filed regarding the New Jersey bankruptcy court’s venue decision in the Multi-Color Corporation’s chapter 11.

It’s no secret that New Jersey has become on of the favored forum-shopping venues for large chapter 11 cases. It’s still not the premier filing venue, but it’s outpacing basically everyone except Delaware, SDTX, and SDNY when it comes to mega cases (>$1 billion in liabilities). What’s more interesting, though, is what happens to those cases when they get filed in New Jersey. The court’s local rules say that case assignment is by “vicinage”–basically north Jersey goes to Newark, central to Trenton, and south to Camden. But take a look at case assignments for cases with over $100 million in liabilities in NJ since 2018.

There is clearly not random assignment of large chapter 11 cases in New Jersey: an outsized share of large cases are going to just one judge. Now one would expect some flexibility in assignment given vacations, conflicts, and caseloads. But one still would not expect half of the large cases to end up with just one of the nine judges. The distribution to that one just is more than two standard deviations from the expected mean.

I don’t have an explanation about what’s happening in New Jersey, but it is very strange, and one can understand why litigants might be concerned that there isn’t just forum shopping, but possibly also judge shopping going on. 

Beyond that, that brief makes two other points that I think are important. First, it points out (although I couldn’t do it in enough detail given the word limit) how DIP financing agreements are used as financial suicide pacts that debtors (and their allies) can point to any time there is a threat to their preferred case timeline and outcomes. Bankruptcy courts really need to get better at pushing back against having any case milestones in a DIP financing agreement. But they won’t as long as there’s competition among venue for case filings. 

Finally, the brief argues that mandamus, although an extraordinary remedy, should be administered freely in bankruptcy cases because of the unusual obstacles to bankruptcy appeals. Mandamus is likely the only chance for meaningful appellate review of most matters in a Chapter 11 case because of 11 USC 363(m) and 364(e) + the final order requirement for an appeal as of right + equitable mootness. Many problems in bankruptcy cases are harms that are capable of repetition yet evading review. Mandamus is not the ideal way to fix the problem, but it’s the most immediate fix and really the only one the courts can do unilaterally. 

Here’s the key cha