The Rationale Behind Del.'s 'Pink Slime' Ruling

Law360, New York (February 15, 2013, 1:13 PM EST) -- Not an uncommon scenario in a bankruptcy court: an employer, owned by a private equity firm, terminates a large number of employees as part of an overall reduction in operations. Judge Mary Walrath of the Bankruptcy Court for the District of Delaware faced that all too familiar scenario in the now famously named “pink slime” case of AFA Foods.[1]

The debtors faced a sudden downturn in sales courtesy of news coverage which reported on the debtors use of boneless lean-beef trimmings in certain of its products,...
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