Any day now, the Second Circuit could create a split of circuits importuning the Supreme Court to decide whether chapter 13 trustees are paid fees even if no plan is confirmed.
Several justices seemed to believe that ‘prospective relief’ is sufficient to remedy the due process violation because the alternatives are ineffective.
At oral argument, the justices were focused on whether the word “appropriate” in Section 1123(b)(6) allows chapter 11 plans to include nonconsensual, nondebtor third-party releases.
Reversing the BAP, the Ninth Circuit (erroneously) holds that state law cannot demand more documentation for a proof of claim than Bankruptcy Rule 3001 requires for prima facie validity.