Preparing For Potential Restrictions On Claims Trading

Law360, New York (February 12, 2014, 2:23 PM EST) -- An official committee of creditors appointed in a bankruptcy case "stands as a fiduciary to the class of creditors it represents," and similarly, each member is a fiduciary to all such creditors. In re Spiegel, 292 B.R. 748, 750 (Bankr. S.D.N.Y. 2003).

Because of these fiduciary duties, and the fact that committee members often possess material nonpublic information, committee members are often restricted from trading or, at best, are left uncertain as to whether trading in the debtor's securities would violate those duties.

To address these...
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