Article
Source: American Bankruptcy Institute Journal
Article
12.01.23
With nonconsensual nondebtor releases being a key reason that businesses facing mass tort claims have filed for bankruptcy, the U.S. Supreme Court has agreed to hear arguments on “whether the Bankruptcy Code authorizes a court to approve, as part of a plan of reorganization under Chapter 11 of the Bankruptcy Code, a release that extinguishes claims held by nondebtors against nondebtor third parties, without the claimants’ consent.”
As there is uncertainty concerning such releases pending the Supreme Court’s decision in Purdue, a recent article written by Finance & Restructuring partner Hugh Ray III and associate James Dickinson highlights an alternative mechanism to protect key chapter 11 participants from vexatious litigation while preserving a plaintiff’s right to assert its claims.
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