Lindsey Simon

Associate Prof @EmoryLaw, focusing on bankruptcy, commercial law, and procedure

[Lindsey Simon @LindseyDSimon]

A little bari sax for the faculty talent show @EmoryLaw

[Alex Wolf @awolf86]

NEW: Purdue Pharma gets bankruptcy plan/opioid liability settlement approved. The $7.4 billion plan, which was renegotiated after a 2024 Supreme Court ruling, gives creditors the option to keep their rights to sue the company's Sackler family owners. https://t.co/SGMHtpz93p

[Lindsey Simon @LindseyDSimon]

Ultimately, the court concludes that prolonging bankruptcy churn (and further delaying stayed claimants) with a patently uncomfortable plan is not in the best interest of any involved. With one final nudge toward an out-of-court deal, the court turns the case away.

[Lindsey Simon @LindseyDSimon]

Massively consequential ruling out of Houston this evening: bankruptcy court dismisses Red River Talc, LLC's (J&J pt. III) prepackaged bankruptcy case.

[Lindsey Simon @LindseyDSimon]

*Section 524(g).

As to dismissal, the court is very careful to distinguish this case from LTL's two-part journey through New Jersey. Importantly, it finds that filing a case like this is not in bad faith, and resolving mass tort claims serves a valid bankruptcy purpose. 👀

[Lindsey Simon @LindseyDSimon]

Additionally, the court denied confirmation due to inclusion of non-consensual, non-debtor releases. In the first opinion I've seen addressing this point, the court rejected the debtor's claim that this is a "full pay" case that is saved under SCOTUS's opinion in Purdue Pharma.

[Prof. Jacoby @melissabjacoby]

No pleasure comes from sharing this investigative reporting.

But the federal judiciary & bankruptcy profession need to reckon with what's happened/happening here.

Also quotes writings of @NancyRapoport, & includes comments from former judge Bruce Markell.

[Lindsey Simon @LindseyDSimon]

@elizabethcburch @melissabjacoby I looked through the seven (!) plan supplements and all I could find was the following "working draft" agreement filed back in February that gives some contours of payment to settle the U.S. Government Claims:

[Lindsey Simon @LindseyDSimon]

@elizabethcburch @melissabjacoby Where can we find those? The Plan Supplement (which is the "yada yada yada" of plans, often containing critical items for claimants like trust agreements setting the rules of engagement for recovery in cases with mass litigation...all finalized post-voting or even confirmation!).

[Lindsey Simon @LindseyDSimon]

I’m curious whether, before a ruling, the settlemtn proponents agree to carve out certain claims or remove release-based contingencies to satisfy the court’s concerns and avoid dismissal.

Stay tuned, more to come on Tuesday.
/end

[Lindsey Simon @LindseyDSimon]

Why, then, should opting out of a nondebtor release for direct claims be contingent on foregoing a right to payment of a percentage of the estate’s claims? It shouldn’t.

[Lindsey Simon @LindseyDSimon]

As is common, I do not think any sum will satisfy the United States Trustee’s objection. This is especially true after Senator Warren’s bolstering statement back in January.