SEC Says Alta Mesa Ch. 11 Can't Release Fraud Claims
Law360 (May 20, 2020, 8:40 PM EDT) -- The U.S. Securities and Exchange Commission asked a Texas bankruptcy court Wednesday to reject the legal releases in oil and gas driller Alta Mesa Resources Inc.'s Chapter 11 plan, saying they would improperly allow the company and its executives to escape securities fraud claims.
The agency said the proposed liquidation plan would improperly bar legal claims by current and former shareholders against the company and "numerous" third parties that Alta Mesa has failed to show contributed to the plan.
"Even more troubling, the releases here grant immunity for scienter-based behavior, including fraud, willful misconduct, and gross negligence," it said.
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