by Rhonda D. Orin
Anderson Kill & Olick LLP; Washington, D.C.
Two decisions this summer from the U.S. District Court for the Western District of Pennsylvania joined the increasingly long list of cases holding that insurance companies lack standing to object to confirmation of bankruptcy plans.
The district court affirmed bankruptcy court determinations of no standing in Hartford Accident & Indemnity Co. v. Global Indus. Tech. Inc., Civil Action No. 07-1749, Bankr. Case No. 02-21626 (JFK) (W.D. Pa. Jul 25, 2008) (GIT) and Hartford Accident & Indemnity Co. v. North Am. Refractories Cos. et al., Civ. Action No. 07-1750, Bankr. Case No. 02-20198 (JFK) (W.D. Pa. Jul. 25, 2008) (NARCO).
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by Debra L. Innocenti
Oppenheimer, Blend, Harrison & Tate Inc.; San Antonio
A number of key opinions were issued this year, converging around the jurisdictional reach of a §524(g) injunction, preemption of insurance policy anti-assignment provisions, and the limitations of the power of Rule 9019 to override statutory requirements of the Bankruptcy Code.
Classification
In re Congoleum Corporation et al., U.S. Bankruptcy Court, District of New Jersey, Case No. 03-51524 (June 5, 2008) (J. Kathryn C. Ferguson)
The bankruptcy court held that the creation and differing treatment of two subclasses of asbestos claimants in the debtors' joint plan of reorganization violated §§1129 and 524(g) of the Bankruptcy Code. One subclass consisted of all asbestos claimants who gave up in an omnibus settlement agreement (or never had) rights under certain pre-petition settlement agreements. In contrast, the other subclass claimants had the option to have their rights to payment determined through a continued adversary proceeding that would, in effect, entitle them to a chance for greater recovery. The bankruptcy court held that in addition to complying with the classification provisions of the Code, the plan must also comply with the overlay of §524(g), which required that the plan value all present and future similar claims in substantially the same manner. The only proper criterion for differing between the pre-judgment claims was disease level. Moreover, the bankruptcy court held that an omnibus settlement agreement with the asbestos constituents that could meet "the very low threshold of Rule 9019" did not permit noncompliance with §§524(g) and 1129.
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The Winter Leadership Conference will be held Dec. 4-6 in Tucson, AZ at the Westin La Paloma. This year's conference will feature another great group of sessions and speakers, as well as some top-notch entertainment! The Mass Torts Committee will hold a session in conjunction with the Alternative Dispute Resolution Committee on Saturday morning at 9:45 a.m. entitled "If You Can Make It (Work) Here, You Can Make It (Work) Anywhere: Alternative Dispute Resolution in Mass Torts and Complex Reorganization Cases." Jacob A. Esher of Altman Riley Esher LLP in Boston will moderate the panel and will be joined by Lisa Hill Fenning of Dewey & LeBoeuf LLP in Los Angeles and Mark D. Plevin of Crowell & Moring LLP in Washington.
Click here to register now!
