Consensual Release

In June 2024, the U.S. Supreme Court released its opinion in Harrington v. Purdue Pharma L.P, for which a sharply divided court concluded that U.S. bankruptcy courts and U.S. district courts exercising bankruptcy jurisdiction lacked the authority to approve a Chapter 11 bankruptcy plan if that plan includes a nonconsensual release of any nondebtor’s claims against another nondebtor. In his August Illinois Bar Journal article, "Consensual Releases," Austin R. Carlson explains why practitioners looking for guidance after Purdue Pharma should should focus on how the ruling may affect negotiating a favorable settlement with a third-party funding source, soliciting releases from the estate’s creditors to maximize creditor buy-in, and crafting a reorganization plan to maximize the odds of confirmation. 

Read, "Consensual Release," in the August Illinois Bar Journal.