Cozen’s Horan tapped for Delaware Bankruptcy Court

WILMINGTON – Thomas Horan, one of Delaware’s leading bankruptcy lawyers, was recently appointed to a judgeship on the U.S. Bankruptcy Court for the District of Delaware.

Thomas Horan | PHOTO COURTESY OF COZEN O’CONNOR

The former Cozen O’Connor lawyer was sworn into the eight-member court on March 22, filling the seat vacated by retired Judge Christopher Sontchi last year. The court, one of the busiest bankruptcy courts in the nation due to Delaware’s status as incorporation capital of the country, now has a full bench once again.

Unlike federal district and circuit court judges, bankruptcy judges are considered “legislative judges” who take on assigned cases by district courts. Because they are not created under the Constitution, bankruptcy judges do not have to be confirmed by the U.S. Senate and are appointed by presiding circuit courts to 14-year terms.

Prior to his appointment, Horan practiced in Wilmington for 18 years, focusing on financial restructuring and bankruptcy litigation. He was most recently a member of the Bankruptcy, Insolvency and Restructuring group at Cozen O’Connor, a national firm headquartered in Philadelphia with a Wilmington office. Horan joined Cozen in a group-wide 2020 defection from Fox Rothschild, which he had worked for since its own 2018 merger with Wilmington-based Shaw Fishman Glantz & Towbin.

His national practice included representing debtors and official unsecured creditor committees in complex Chapter 11 proceedings, but he also represented secured creditors and other parties in litigation. Horan also frequently provided opinion letters on commercial transactions and represented parties before the state’s Court of Chancery and Superior Court.

Last year, Horan was named to Lawdragon’s list of the Top 500 U.S. bankruptcy and restructuring lawyers. He also serves on the Board of Directors of the American Bankruptcy Institute, the national organization that represents the interests of thousands of bankruptcy and restructuring lawyers.

“We congratulate Tom on his appointment to this distinguished bench,” John T. Carroll III and Mark E. Felger, co-chairs of the firm’s Bankruptcy, Insolvency & Restructuring group, said in a statement. “Tom is very deserving of this honor and will no doubt be a fair, impartial, and learned judge. On behalf of Cozen O’Connor, we congratulate Tom and wish him well in his new role as a bankruptcy court judge.” 

Horan earned his law degree from St. John’s University School of Law, and both his master’s and bachelor’s degrees from Fordham University.

Delaware has long been a national leader for bankruptcy filings, with its federal court considered a top magnet venue for the most complex cases involving the largest number of assets. That’s exemplified by current Delaware cases involving failed cryptocurrency exchange FTX, the Boy Scouts of America national organization and even private rocket company Virgin Orbit, which filed for Chapter 11 protections in Wilmington on Tuesday morning.

At the height of the pandemic in 2020, the U.S. Bankruptcy Court for the District of Delaware saw 1,666 Chapter 11 filings, more than doubling 2019’s total and reaching levels not seen since the Great Recession. Those filings included a near record 57 “mega case” filings with assets of at least $100 million.

Many in the financial and legal industries expected those numbers to continue into 2021 as the pandemic’s effects ground down company’s revenues and profits.

Conversely though, government intervention through the Paycheck Protection Program, stimulus checks and other programs along with low interest rates helped to prop up many companies and keep them out of bankruptcy, which led to a dramatic slowdown in filings nationwide and in Wilmington.

Chapter 11 filings here fell 68% to 524 in 2021, and of that the state’s share of Chapter 11 “mega cases” fell from 98 to 33. Despite those declines, Delaware continued to be the top stop for many large companies seeking to reorganize its debts or liquidate assets, ranking No. 1 in total Chapter 11 filings.

Much like the nearby Delaware Court of Chancery’s reputation on corporate law, bankruptcy petitioners prefer to file in Delaware due to the knowledge of its eight-member judicial panel who rule on the cases.

The Wilmington court’s weighted caseload per judge was 2,363 in 2021, which is by far the largest of any court in the country. That caseload for the court led by Judge Laurie Silber Silverstein will get a little easier with Horan now seated on the court.