Insurers Can Object To 'Neutral' Ch. 11 Plans

Law360, New York (May 20, 2011, 3:28 PM EDT) -- In a recent decision arising out of the Chapter 11 bankruptcy case of Global Industrial Technologies Inc. (GIT),[1] the U.S. Court of Appeals for the Third Circuit, sitting en banc, held that insurance companies that had issued liability insurance policies to a manufacturer before its bankruptcy filing had standing to object to confirmation of the company’s Chapter 11 plan of reorganization, even though the plan had been designed to be “insurance neutral” with regard to the policies.

In the May 4 opinion, a six-judge majority of...
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