Introduction
"Tell me about a recent restructuring case you've been following" is one of the most differentiating questions in Rx interviews. Unlike behavioral questions (which test consistency) or technical questions (which test memorization), the recent-case question tests genuine market engagement. Candidates who track the actual market with attention give substantively different answers than candidates who studied a textbook.
This article walks through:
- how to structure recent-case discussions
- what cases to know
- the four-pillar framework that makes answers strong
- the common mistakes to avoid
The Four-Pillar Framework
A strong recent-case discussion covers four specific dimensions in roughly 3-5 minutes total.
Pillar 1: Capital structure entering distress. What did the company's debt and equity stack look like? What were the major debt instruments, with approximate sizes, security packages, and intercreditor relationships? This sets the foundation for everything that follows.
Pillar 2: The trigger event. What pushed the company into distress or bankruptcy? Was it operational underperformance, a refinancing wall, a fraud or governance event, a regulatory shock, or a sector-specific catalyst? The trigger event explains the timing and shapes the case strategy.
Pillar 3: Case strategy and key motions. What is the company's restructuring strategy: out-of-court LMT, prepackaged Chapter 11, prearranged Chapter 11, freefall Chapter 11, or Section 363 sale? What were the major first-day motions, DIP financing structure, and contested issues during the case?
Pillar 4: Recovery profile. How are creditor recoveries shaping up by class? What does the fulcrum security look like? Who wins, who loses, and what does the post-emergence capital structure look like?
Choosing Cases to Know
Strong candidates know one or two cases in real depth rather than five cases at surface level. The right choice depends on the candidate's interests, target firms, and current market dynamics.
For the 2026 interview cycle, the best cases to know cold are:
- First Brands Group. The largest 2025 freefall filing with fraud allegations, complex DIP structure, and significant trading dispersion. The case is the textbook example of "everything goes wrong at once."
- Rite Aid (2025 Chapter 22). Demonstrates Chapter 22 dynamics, lender DIP roll-up structures, bifurcated sale processes, and the post-emergence failure pattern.
- Forever 21 (2025). Illustrates the operating-entity-versus-IP split, private equity-driven retail liquidation, and unsecured creditor recovery dynamics (3-6%).
- Joann (2025). Second-time-around liquidation with stalking horse dynamics, GA Group as auction winner, and rapid wind-down.
- Wolfspeed (2025). Industrial distress with $4.6 billion debt restructuring, semiconductor industry pressure, and CHIPS Act subsidy uncertainty.
- Sunnova Energy (2025). Largest residential solar bankruptcy with $10.67 billion in total debt and significant ABS market implications.
| Case | Key Dimension | Best For |
|---|---|---|
| First Brands | Fraud + complex DIP | Demonstrating breadth across legal/operational/financial dimensions |
| Rite Aid | Chapter 22 + Guggenheim Securities advisor | Showing knowledge of repeat-filing dynamics |
| Forever 21 | PE-owned retail liquidation | Illustrating recovery profiles for unsecured |
| Joann | Going-concern auction to liquidation | Section 363 sale dynamics |
| Wolfspeed | Industrial + policy | Sector-specific distress drivers |
| Sunnova | Solar industry collapse | Renewable energy distress |
The "Banker Side" Question
A common follow-up to the recent-case discussion is: "Which side would you have wanted to be on?" This tests whether the candidate can think strategically about advisor positioning.
Strong answers consider several factors:
- Mandate complexity and intellectual challenge. First Brands creditor side (representing the 81-member ad hoc group) involves fraud-related diligence, complex priority disputes, and significant trading dynamics, making it analytically challenging.
- Compensation and fee dynamics. Debtor-side mandates typically generate larger absolute fees but creditor-side mandates can produce strong fees on contested cases. The First Brands case fee pool likely exceeds $100 million total across all advisors.
- Career development. Different sides develop different skills. Debtor-side mandates emphasize plan negotiation, DIP structuring, and stakeholder management. Creditor-side mandates emphasize claim valuation, capital structure analysis, and aggressive negotiation.
- Personal interest. Some candidates are drawn to debtor-side work because of the operational complexity; others prefer creditor-side because of the analytical purity.
Common Mistakes
Several specific mistakes recur in weak recent-case discussions:
- Surface-level coverage. Candidates who know the case name and one or two facts but cannot discuss capital structure, trigger event, and case strategy in detail. Strong answers go deep on at least one case.
- Outdated cases. Discussing cases from 2018-2022 when 2024-2025 cases provide much richer current-market content. Strong answers reference recent cases.
- Confusing case details. Mixing up Rite Aid's first and second filings, confusing Joann's 2024 emergence with the 2025 second filing, or misstating capital structure details. Accuracy matters.
- Pure narrative without analysis. Telling the story of the case without articulating analytical insights about what makes the case interesting. Strong answers combine narrative with analytical commentary.
- Avoiding the controversy. Some cases involve genuine controversy (Texas Two-Step, Purdue Pharma releases, contested LMTs). Strong candidates can discuss the controversy thoughtfully without taking strong personal sides.
Preparation Method
Effective preparation for recent-case discussions follows a specific approach:
1. Pick two cases that interest you genuinely. The interest matters because authentic engagement shows in the answer. 2. Read the case docket on Kroll Restructuring Administration or PACER. The actual court filings provide depth that summary articles cannot. 3. Read at least three substantive law-firm or financial-press articles on each case (Kirkland, Weil, Bloomberg Law, the Wall Street Journal). 4. Track the bond and loan trading levels through Octus, Bloomberg, or other data sources. 5. Build a written summary of each case covering all four pillars. 6. Practice the answer aloud until delivery is fluent. 7. Prepare for follow-up questions on specific phases (DIP structure, plan terms, recovery profile).
The recent-case discussion is the single best opportunity in Rx interviews to demonstrate genuine market engagement. Candidates who do this well differentiate themselves from generic IB applicants and signal that they will arrive at the firm with substantive market awareness rather than just academic preparation.
One additional dimension worth covering: the LMT cases (Serta, Mitel, Wesco, Robertshaw, Incora, ConvergeOne) are also fair game in recent-case discussions. Strong candidates can speak to the legal evolution of uptier exchanges, the December 2024 Serta Fifth Circuit ruling, and the post-Serta cooperation era. The LMT cases test a different dimension of market knowledge (legal-doctrine awareness combined with creditor dynamics) that complements the operational-distress cases. Candidates targeting creditor-side mandates particularly should engage with the LMT cases because creditor-side work increasingly involves cooperation agreement organization and post-Serta structuring.
The next and final article in this section provides the comprehensive technical question bank that completes Rx interview preparation.
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