Lisa Qian

When I first started law school in 2023, taking a bankruptcy course was at the top of my list. But it wasn’t because I wanted to be a bankruptcy lawyer; instead, knowing that I wanted to represent survivors, many mentors said that they did not know the first thing about bankruptcy, but that if they could do law school over again, they would have taken that doctrinal class. The trend was clear: so many defendants were trying to file for bankruptcy to escape accountability.

Throughout now Stanford Law Dean George Triantis’s class, I was always thinking about how the concepts we were learning would apply to Chapter 11 cases involving tort creditors. In particular, I started to think about the diocese cases and other cases driven by liability for child sex abuse. And many of the concepts suddenly didn’t seem to make as much sense when you looked at a nonprofit filing for Chapter 11, rather than a corporation with equity value.

Take the absolute priority test. It is supposed to make sure that if creditors aren’t being paid in full, no one junior to them gets anything. But in the context of a non-profit, there’s no equity to wipe out and no one clearly “junior” to the creditors—so the rule doesn’t really do anything at all. Or consider the best interests of creditor test, which is supposed to set a floor by ensuring creditors receive at least as much as they would in a Chapter 7 liquidation. But in the nonprofit context, that comparison starts to break down. Nonprofits can’t be forced to liquidate, and the liquidation analyses themselves, I found, when diving deep into the bankruptcy dockets, are often so speculative and manipulable that they don’t provide a meaningful baseline. So instead of acting as a real backstop, the test ends up being more theoretical than real.

Not only did the statutory tests meant to force debtors to turn over value to creditors fail to meaningfully apply, but I also began to see how other structural features of bankruptcy systematically shifted leverage away from plaintiffs and toward the debtor. Exclusivity and the automatic stay, for example, strip plaintiffs of the control they would ordinarily have in state or federal district court—where they are the masters of their own cases—and instead consolidate that power in the hands of the debtor.

Given all of this, I decided to compile survivor voting data in child sex abuse bankruptcy cases, expecting to find dissatisfaction. But instead, what I found was that survivors voted overwhelmingly to approve reorganization plans. How could this be?

That question sat with me for a long time. If bankruptcy strips survivors of leverage—if the very statutory protections that are supposed to protect dissenting creditors don’t actually function in the nonprofit context—then why are survivors still voting? And more puzzlingly, why are they overwhelmingly voting yes?

The answer, I came to realize, has very little to do with satisfaction.

One of the central myths surrounding Chapter 11—especially in mass tort cases—is that the creditor vote reflects consent. Courts and commentators point to high participation and approval rates as evidence that the system is working, that survivors are choosing bankruptcy as a forum, and that the outcomes are fair. But when you actually look closer at the structure of these cases, and at the experiences of survivors themselves, that narrative starts to fall apart.

Take participation rates. In many of these cases, voting participation is extraordinarily high—often over 90%, and sometimes approaching 100%. At first glance, that seems to suggest engagement, even endorsement. But that interpretation assumes that voting is a meaningful exercise of choice. It isn’t.

In the diocese cases, voting is often the only moment in the entire process where survivors feel like they have any voice at all. Bankruptcy, unlike civil litigation, does not center individual stories. There is no jury. There is no day in court. There is no opportunity to confront the institution in a public forum. Instead, claims are aggregated, categorized, and processed—efficiently, perhaps, but also impersonally. Against that backdrop, the vote takes on a different meaning. It becomes less about approving a plan and more about being heard.

Survivors vote not because they believe in the system, but because it is the only mechanism available to them to participate in it. As the paper argues, high participation rates are driven by a need for voice, recognition, and community—not by satisfaction with the bankruptcy process.

That helps explain why participation rates are so high. But it doesn’t fully explain why approval rates are too. Because if voting is about voice, approval should still reflect judgment. And yet, again and again, the numbers show overwhelming support for plans that, on paper, don’t seem to offer particularly strong recoveries.

That’s where the second piece of the puzzle comes in: constraint. In theory, voting is supposed to give creditors power. If they don’t like the plan, they can reject it, and the law provides back-end protections to ensure they aren’t worse off. But as I had already seen, those protections don’t really function in the nonprofit context. There is no meaningful liquidation alternative. There is no equity to strip. There is no credible threat that forces the debtor to increase its offer.

So what does a “no” vote actually do? For many survivors, the answer is: not much.

Rejecting a plan doesn’t send them back to a world where they can pursue their claims freely in court. The automatic stay is still in place. The case doesn’t disappear. Instead, the process drags on. Negotiations continue. Legal fees mount. And for survivors—many of whom have already spent years in litigation before the bankruptcy was even filed—the prospect of starting over or waiting even longer can feel unbearable. 

By the time a plan is put to a vote, survivors are often exhausted. Years may have passed since they first came forward. Many have relived their experiences multiple times—through interviews, depositions, claim forms, and communications with their attorneys. Bankruptcy adds another layer of delay and uncertainty. And unlike trial, it rarely offers the kind of closure that comes from having one’s story publicly acknowledged.

So when the vote finally arrives, it’s not happening at the beginning of a process. It’s happening at the end of a very long one. At that point, the question is less “Is this fair?” and more “Can I be done?”

And that’s where approval rates start to make sense. Not as an endorsement of the system, but as a reflection of fatigue—and of the absence of meaningful alternatives. In that light, the idea that high approval rates legitimize bankruptcy outcomes becomes much harder to defend. If the choice is between accepting an imperfect plan now or facing years of additional delay with no guarantee of a better outcome, then a “yes” vote doesn’t necessarily tell us much about the quality of the plan itself.

Through my research, I came to realize that the only way for the vote to meaningfully reflect survivors’ preferences is to make bankruptcy look more like the state court system it replaces—lifting the automatic stay and allowing cases to proceed to trial, creating opportunities for confrontation, and restoring some measure of control to plaintiffs. Without those measures, the vote reflects fatigue, not choice. But, importantly, these measures are already within the discretion of bankruptcy judges—they require no statutory reform, only a willingness to use the tools that already exist. My hope is that more bankruptcy judges choose to utilize them.

The full paper can be downloaded and read here.