9th Circ. Says Asbestos Law Bars Insulation Co.'s Ch. 11 Plan

Law360, Los Angeles (October 28, 2013, 8:24 PM EDT) -- The Ninth Circuit on Monday reversed an order confirming the reorganization plan of Chapter 11 debtor Plant Insulation Co., holding that the plan failed to include proper protection for asbestos claimants, although the panel OK'd the plan's "settling insurer injunction." 

The three-judge appellate panel held that the reorganization plan did not comply with Section 524(g) of the Bankruptcy Code, under which a court-appointed fiduciary stands in for future asbestos claimants. In the typical § 524(g) plan, present and future asbestos claimants receive recovery from a trust...
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