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Expert Analysis

The Possible Death Of Nondebtor Substantive Consolidation

By R. Stephen McNeill and D. Ryan Slaugh (September 24, 2018, 2:09 PM EDT) -- Last year, we wrote an article discussing the split of authority surrounding a bankruptcy court's ability to substantively consolidate a debtor with a nondebtor.[1] Since that time, several courts have further addressed the availability of this remedy. While most of those decisions have found that nondebtor substantive consolidation is appropriate in the right circumstances, all of them have imposed significant practical limitations that effectively make nondebtor substantive consolidation all but impossible....

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