Denying Disclosure Statements For An Unconfirmable Plan
August 7, 2012, 1:41 PM EDT
Law360, New York (August 7, 2012, 1:41 PM EDT) -- On July 25, 2012, the U.S. Court of Appeals for the Third Circuit Court in In re American Capital Equipment LLC affirmed the bankruptcy court’s decision finding (1) at the disclosure statement stage, that the debtors’ Chapter 11 plan was patently unconfirmable, and (2) converting the Chapter 11 case to Chapter 7.
While bankruptcy courts in various jurisdictions already have widely recognized the authority to deny approval of a disclosure statement where a plan is patently unconfirmable, the Third Circuit has become the first circuit court...
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