Bayou, Brooke And 'Substantial Contributor' Claims

Law360, New York (April 19, 2011, 1:30 PM ET) -- Generally, Sections 503(b)(3)(D) and (b)(4) of the Bankruptcy Code provide an administrative expense priority claim for the actual and necessary expenses of a creditor, indenture trustee, equity security holder or member of an unofficial committee representing creditors or equity security holders, and for certain fees and expenses of professionals to such parties, in making a “substantial contribution” in a Chapter 9 or Chapter 11 bankruptcy case.

While the Bankruptcy Code does not define the term “substantial contribution,” courts generally consider “whether the efforts of the applicant...
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