3rd Circ. Nixes BNY's Ch. 11 Release From Hospital Creditors
By Andrew Scurria
Law360, New York (July 3, 2014, 7:32 PM EDT) -- The Third Circuit on Thursday upheld a bankruptcy court decision exposing Bank of New York Mellon Trust Co. NA to claims from aggrieved bondholders of a Philadelphia-area hospital, agreeing that the debtor’s reorganization failed to disclose that they would waive those claims by accepting an $8.2 million settlement.
A unanimous panel refused to hold the bondholder group to a provision in the disclosure statement of once-bankrupt Lower Bucks Hospital releasing claims that BNY mishandled their bonds as indenture trustee and cost them secured creditor status on...