The Gifting Doctrine V. The Absolute Priority Rule

Law360, New York (March 28, 2011, 3:40 PM EDT) -- On Dec. 6, the U.S. Court of Appeals for the Second Circuit weighed in on the contentious debate over the “gifting doctrine.” The debate centers around the ability of a senior creditor to “gift” property to a junior claimholder over the objection of claimholders situated between the two parties on the priority scale. See Dish Network Corp. v. DBSD N. Am., Inc. (In re DBSD N. Am., Inc.), 2010 U.S. App. LEXIS 27007 (2d Cir. Dec. 6, 2010).

The debate gained steam in 1993 after the...
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