In the Summer 2021 edition of the Restructuring Report, I wrote about legislative efforts to reform the Bankruptcy Code to place limits on the use of third party releases in bankruptcy plans of reorganization.

Court watchers have kept a close eye on the In re: Purdue Pharma LP chapter 11 bankruptcy case, and for good reason. It is one of the largest cases to test a question that has divided the Circuit Courts of Appeals: can a debtor in its chapter 11 plan include releases from liability for non-debtor third parties over the objection of creditors? Although the debate over the answer has been stewing for some time now, a December 2021 decision from the Southern District of New York may finally cause the pot to boil over.

Unless the owner of a limited liability company elects to be treated as a corporation for tax purposes, the IRS will treat a single-member LLC as a “disregarded entity” for tax purposes. As a disregarded entity, an LLC’s assets, liabilities, income and deductions are reported as belonging to the owner for tax purposes. Markell Co. v.

In one of the most important bankruptcy court decisions of all time, Northern Pipeline Construction Co. v. Marathon Pipe Line Co., the United States Supreme Court held that the 1979 Bankruptcy Code was unconstitutional because it lodged too much judicial power in bankruptcy judges who were not given “Article III” status, which grants lifetime tenure and salary protection and helps assure judicial independence.

On March 22, 2017, the Supreme Court decided Czyzewski v. Jevic Holding Corp., holding that a bankruptcy court may not approve a structured dismissal of a Chapter 11 bankruptcy case if the order does not comply with the priority rules of the Bankruptcy Code. 580 U.S. __ (2017).