Becoming a distinguished legal scholar is as much about asking interesting questions as finding the right answers. This inquisitiveness is among Foteini (“Fay”) Teloni’s chief assets. In June, Teloni will become one of Fordham Law’s inaugural graduates of its Doctor of Juridical Science program. Her research asks how recent amendments to the Bankruptcy Code—the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA)—have changed the way that bankrupt corporations reorganize under Chapter 11, and what these changes mean for investors.
Teloni was a member of the program’s first entering class in fall 2011. After participating in the S.J.D. colloquium, she began work on the three articles that would constitute her dissertation. The first article was published in the American Bankruptcy Law Journal, and the second will soon be published in the American Bankruptcy Institute Law Review. Her third article is currently under review by a well-respected bankruptcy journal.
Teloni’s academic efforts, including a seminar she taught to law students, have garnered much respect from her peers and professors.
“Fay was such a strong candidate—her ideas were so interesting, her empirical results so important—that by the time she was halfway through the program, she had effectively become a colleague,” said Professor Richard Squire, her faculty advisor. “I was giving her feedback on her work in much the same way I would give to any other scholar who writes in my area of interest.”
Teloni’s first paper, “The Bankruptcy Abuse Prevention and Consumer Protection Act: An Empirical Examination of the Act’s Business Bankruptcy Effects,” used a multivariate logistic regression model to examine and quantify—for the first time—the effect of BAPCPA on Chapter 11 corporate bankruptcies. She studied two samples of firms: a broad group from numerous industries and a more focused group consisting solely of retailers. In both samples, she found that the 2005 amendments have caused more debtors to sell all their assets in bankruptcy rather than undergo a traditional Chapter 11 reorganization.
Her second paper, “Chapter 11 Duration, Preplanned Cases, and Refiling Rates: An Empirical Analysis in the Post-BAPCPA Era,” explored the effect of BAPCPA on three distinct aspects of Chapter 11:
(1) the duration of traditional Chapter 11 cases
(2) the use of prepackaged and pre-negotiated bankruptcies
(3) the “recidivism” rate—that is, how often debtors refile for bankruptcy within five years
The paper found that BAPCPA has produced shorter Chapter 11 cases and has caused more debtors to negotiate their reorganization plans before entering bankruptcy court. Finally, the paper finds that the bankruptcy recidivism rate has risen—a worrisome result.
Her third paper, “Preserving Value in the Post-BAPCPA Era: An Empirical Study,” asks whether today’s faster bankruptcies have meant an increase or decrease in creditor recoveries. The study finds that, since the 2005 amendments, creditors are indeed recovering more in traditional Chapter 11 reorganizations, a result explained by the fact that more reorganization plans are being negotiated before the debtor files for bankruptcy.
Teloni grew up in Lamia, Greece. She received an undergraduate degree and an LL.M. in commercial law from the University of Athens. While studying there, she was inspired to pursue law in the United States. She left Greece in 2009 and matriculated at Fordham Law in its Master of Laws program. During her time at Fordham as an LL.M. student Teloni developed an interest in bankruptcy law.
“Something about it just clicked,” she said. “What I found particularly intriguing in Chapter 11 was this ‘bargaining’ that takes place among all stakeholders involved and the delicate balances whose shift to the one or the other direction may have the effect of dictating the outcome of the reorganization case.”
She received an LL.M. in Banking, Corporate, and Finance Law and has been conducting research in the field ever since.
“We are particularly proud to recognize Fay as one our first S.J.D. graduates because she earned a master’s here at the School as well,” said Toni Jaeger-Fine, Assistant Dean of International and Non-J.D. Programs. “This is an auspicious beginning for our growing S.J.D. program, and we look forward to celebrating more talented students in the future.”
As for Teloni’s future, she has accepted a position at the New York office of Shearman & Sterling, where she will work as an associate in the firm’s Financial Restructuring & Insolvency Group.