In a highly anticipated decision issued last Thursday (on December 19, 2019), the United States Court of Appeals for the Third Circuit held in In re Millennium Lab Holdings II, LLC that a bankruptcy court may constitutionally confirm a chapter 11 plan of reorganization that contains nonconsensual third-party releases. The court considered whether, pursuant to the United States Supreme Court’s decision in Stern v. Marshall, 564 U.S. 462 (2011), Article III of the United States Constitution prohibits a bankruptcy court from granting such releases.

The Illinois Supreme Court recently provided certainty to dissolving corporations with respect to the risk of facing a lawsuit even after it has long since dissolved. Illinois permits lawsuits against dissolved corporations for up to five years after the corporation has ceased to exist. The Supreme Court clarified that only those claims that have accrued prior to the corporation's dissolution (i.e., the injury occurred prior to dissolution) may be brought in that five-year period.