New opinion: Third Circuit affirms asbestos bankruptcy reorganization without a trust for future claims

In re: Energy Future Holdings Corp. (Fenicle)—bankruptcy—affirmance—Krause

The Third Circuit today held that the chapter 11 bankruptcy reorganization plan of an asbestos company did not violate the due process rights of latent asbestos claimants, even though it included a bar date and did not establish a trust to pay future claims, because the plan allowed individual claimants whose asbestos-related injuries manifest after the bar date to reinstate them. Today’s opinion is the latest in a long, proud line of Third Circuit cases grappling with how to adjudicate asbestos cases efficiently and fairly.

Joining Krause were Matey and Quiñones Alejandro EDPA by designation. Arguing counsel were Leslie Kelleher of Caplin & Drysdale for the appellant latent asbestos claimants and J. Christopher Shore of White and Case and Mark McKane of Kirkland & Ellis for the appellees.