Inside Bankruptcy Court: Credibility, Pressure, and Hard Calls
Most people think bankruptcy judges spend their time interpreting statutes and resolving legal disputes.
As Hon. Michael B. Kaplan explains on Reviving Giants, the reality is that bankruptcy courts are often trying to solve fast-moving business problems with incomplete information and enormous consequences.
“Bankruptcy judges were trial level courts,” Judge Kaplan says. “We’re there to solve problems.”
That requires something more than legal argument.
It requires preparation, credibility, and professionals who understand the business in front of the court.
“How Can I Help?”
Judge Kaplan offers an unusually direct description of how he approaches the courtroom.
“My first statement to the courtroom — besides ‘be seated’ and ‘let’s move on’ — is: ‘How can I help?’”
That framing says a great deal about how bankruptcy courts function in practice.
The court is not there to run the business. It is not there to create strategy. It is not there to negotiate operations on behalf of management or creditors.
But the court does need enough reliable information to make decisions that can impact thousands of employees, vendors, lenders, and customers in real time.
That becomes difficult when lawyers focus exclusively on motions and procedural arguments while failing to explain the underlying business.
“What I see as a failure by many members of the bar is that they don't understand their client’s business as much as they should have,” Kaplan says.
Reputation Matters More Than Many Professionals Realize
One of the more revealing parts of the conversation centers on professional credibility.
Judge Kaplan acknowledges that the reputation of lawyers, CROs, advisors, and independent directors affects how courts evaluate cases.
“The lawyer’s reputation is going to be a signal to the court, I think, of the chances of success,” he says.
That does not mean outcomes are predetermined. But experience matters.
Courts notice whether professionals have successfully shepherded companies through restructurings before, or whether they appear to be delaying inevitable outcomes while liquidity disappears.
Judge Kaplan also emphasizes the importance of professionals who can challenge assumptions and present objective analysis.
“I’d like to hear from somebody who’s come in objectively,” he says, referring to restructuring officers and independent advisors.
That objectivity becomes especially important when existing management has lost credibility or failed to recognize operational deterioration early enough.
The Court Needs Evidence — Not Theater
Judge Kaplan repeatedly returns to the importance of preparation and substance.
Lawyers who simply repeat their briefs in court are not helping the process.
“I read backwards,” he explains, describing how he reviews replies and oppositions first in order to identify the real disputed issues.
What he wants from counsel is responsiveness — not performance.
“If you're not responsive to my inquiries, then you're not helping me help you or your clients.”
That practical mindset also explains why judges rely heavily on experts, financial advisors, and operational professionals in large restructurings.
“You don’t want me — the judge — making the business decisions at the end of the day,” Kaplan says. “I’m the last person who’s qualified to do that in the room.”
Judges need experts who can explain liquidity, operations, financing structures, market conditions, and economic realities in understandable terms.
Otherwise, the court is left guessing — and no one benefits from that.
The Pressure Is Real
Perhaps the most striking part of the discussion is Judge Kaplan’s honesty about the emotional and professional pressure judges carry.
“There’s always pressure with the human element,” he says.
The pressure becomes especially acute when the legally required result conflicts with what feels equitable or practical.
A ruling may determine whether financing continues, whether payroll gets met, or whether a company liquidates.
Those decisions are rarely abstract.
As Kaplan explains, judges know that jobs, businesses, and communities may be affected by rulings issued under severe time pressure and imperfect circumstances.
That reality is easy to overlook from outside the courtroom.
Takeaways For Leaders
- Bankruptcy courts need operational clarity — not just legal arguments
- Professional reputation and credibility materially affect restructuring outcomes
- Advisors must understand the business, not merely the pleadings
- Judges rely heavily on experts to explain economic and operational realities
- Preparation, evidence, and responsiveness matter more than courtroom theatrics
Listen to the Full Episode
Reviving Giants is presented by MACCO Group and hosted by Drew McManigle, a veteran turnaround professional who brings decades of in-the-trenches restructuring experience to each conversation.
To hear the full discussion with Judge Michael B. Kaplan, listen on the Reviving Giants podcast page and wherever you get your podcasts.
***
TL;DR
Judge Michael B. Kaplan explains that bankruptcy courts are fundamentally problem-solving courts operating under pressure and incomplete information. Successful restructurings depend heavily on credible professionals, operational understanding, and evidence — not just legal argument.
