A bankruptcy judge used to be governed by lien status to determine how any monies would be paid out from the sale of the business or the selling off of the business assets.
I'm not an attorney, so I'm probably missing some of the finer points. However, if a business has a mortgage secured by any property that would be in first position then bonds the business sold, then accounts payables and finally any labor agreements, such as defined benefit pensions.
In the case of Chrysler the bond holders received about half of what was paid out to labor even though the bond holders had 3x's as much due them. The smaller bond holders were never consulted and the larger institutional managers of bond funds didn't say much for fear of being blackballed from further business and also fear of govt retaliation. Watch those same businesses get sued for not fulfilling their fiduciary responsibilities.
Sounds like a full employment bill for attorneys.
I like that.