Shirley Cho

Cho is a partner at Pachulski Stang Ziehl & Jones LLP, a corporate restructuring boutique.

“Call me a reorganization restructuring or insolvency lawyer — it all means bankruptcy,” Cho laughed. “Companies need relief. Businesses need to be saved.”

She became fascinated with the field while in law school, working as an extern for U.S. Bankruptcy Judge John E. Ryan, now retired from the Central District’s Santa Ana bench. Cho got the job by chance, she said.

“I wrote every judge in Orange County looking for a job there so I could live with my parents during law school,” she said. “He was the one who responded.”

It was 1994, a dramatic time to work for Ryan, who presided over Orange County’s own bankruptcy, following heavy borrowing, risky investments and rising interest rates that led to a $1.6 billion financial setback. At the time it was the largest county in the U.S. to have declared bankruptcy.

“That was very exciting and unusual, and a lot of fun,” Cho said. “After that, he offered me a job as his clerk, just as he was appointed to the bankruptcy appellate panel” at the 9th U.S. Circuit Court of Appeals. “At first I thought that was too niche, I should go broad, but I found I missed working in commercial bankruptcy, so I took it.”

Part of the interest, for Cho, is the complexity. When deepwater drilling contractor Seadrill Ltd. filed for bankruptcy in 2017, it listed $11 billion in liabilities. It was the largest Chapter 11 case that year.

“This was a Norwegian company headquartered in London,” Cho said. “It filed in Texas. My client was a South Korean shipbuilder.” In re Seadrill Ltd., 17-60079 (S.D. Tex. Bankruptcy Ct., filed Sept. 12, 2017).

“You had a multinational company, a deleveraged balance sheet, and we kept most of it intact,” Cho said. “It was massive. We restructured an enormous amount of debt, and they’re now doing tremendously. And my client got a significant recovery, much more than they expected, including the return of two enormous ships it built for Seadrill. Thousands of workers kept their jobs. It was a great result.”

When the historic Cal Neva Lodge at Lake Tahoe declared bankruptcy, Cho represented the official committee of unsecured creditors. “It was an interesting clash of California and Nevada laws,” she said. “They built the place right on the states’ border so that during Prohibition when the police from one state came they could jump in a boat and escape to the other. We went through 12 different bidders until Larry Ellison stepped up. We backed him and closed the sale.” In re Cal Neva Lodge LLC, 16-51281 (D. Nev. Bankruptcy Ct., filed June 10, 2016).

“I think Chapter 11 is a pillar of what makes companies go ’round,” Cho said. “You wipe the slate clean and start over.”

— John Roemer