A bankruptcy judge said former students, the U.S. Department of Education and other creditors caught up in Corinthian Colleges Inc.’s collapse can vote on the defunct for-profit college operator’s liquidation plan, the Wall Street Journal reported today. Bankruptcy Judge Kevin J. Carey on Monday signed off on Corinthian’s disclosure document describing how it intends to pay off its creditors. Corinthian’s chapter 11 plan creates two separate trusts to dole out the proceeds from the sale of its assets. One trust will pay claims filed by students, government agencies and the Education Department. It isn’t clear how much Corinthian is on the hook for with its former students. Nearly 350,000 students took out some $3.5 billion in federal student loans to attend one of Corinthian’s campuses since 2010, according to the Education Department. Lawyers representing former students are seeking court permission to file a $2.5 billion claim against Corinthian. Votes on the plan are due Aug. 21. Judge Carey will consider approval of the proposal at a confirmation hearing scheduled for Aug. 26 in Wilmington, Del. Read more. (Subscription required.)
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