Justices Mull Where To Draw Line On Clawback Safe Harbors

Law360, Washington (November 6, 2017, 4:02 PM EST) -- The U.S. Supreme Court appeared to be struggling to define the scope of the Bankruptcy Code’s “safe harbor” provision exempting certain securities transactions from trustee clawbacks during oral arguments Monday in a $16.5 million case over a horse track deal with billion-dollar implications for Chapter 11 proceedings.

At a hearing in Merit Management Group LP v. FTI Consulting, the justices floated hypotheticals, asked pointed questions of the arguing attorneys and directed comments at one another in an effort to settle on a proper interpretation of the...
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