A bankruptcy trustee in a court case with the power to upend the roughly $1.4 trillion leveraged loan market plans to ask the U.S. Supreme Court to take up the case after losing an appeal in August, Bloomberg News reported. The Supreme Court gave the trustee, Marc Kirschner, until Dec. 19 to seek review, according to the high court’s online docket. The Court earlier this month extended Kirschner’s deadline after he requested the extra time, citing, among other factors, the hiring of new legal counsel, law firm MoloLamken. The appeal would follow a widely watched ruling won by JPMorgan Chase & Co. and other banks in late August by the U.S. Second Circuit Court of Appeals, which said that a $1.8 billion leveraged loan taken out by drug-testing company Millennium Health was not a security, effectively affirming the status quo. Leveraged loans have traditionally been excluded from securities laws, but in recent years the lines between between the loan and junk bond markets have become increasingly blurred. Plaintiffs in this lawsuit argued that loans should be subject to the same rules as securities like bonds.
