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Are you an Insider who Wants a Release? Not so Fast!

September 03, 2024 (3 min read)

Bankruptcy Code Section 503(c)(1) includes strict requirements for a court to approve retention plans for insiders. Recently, U.S. Bankruptcy Judge Michael E. Wiles of the U.S. Bankruptcy Court for the Southern District of New York issued a ruling in In re Mercon Coffee Corp., invalidating insider releases in a proposed Chapter 11 plan on the basis that the releases were improper retention-related transfers. Check out this expertly drafted article discussing this decision.

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