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Non-Consensual Third-Party Releases No Longer Permissible in Chapter 11 Plans
In 2024, in a 5-4 decision, the Supreme Court rejected the notion that bankruptcy courts may confirm a plan of reorganization that discharges claims against third parties -- without the consent of affected claimants.
Creditors Precluded from Collaterally Pursuing Claims Against Third Party/Guarantor, if Treated/Released in Confirmed Re-Org Plan
In New Falls Corp. v. LaHaye (In re LaHaye), No. 19-30795 (5th Cir. Nov. 12, 2021), the Fifth Circuit Court of Appeals prevented a secured lender from pursuing individual […]
