Are you an Insider who Wants a Release? Not so Fast!

Bankruptcy Code Section 503(c)(1) includes strict requirements for a court to approve retention plans for insiders. Recently, U.S. Bankruptcy Judge Michael E. Wiles of the U.S. Bankruptcy Court for the Southern District of New York issued a ruling in In re Mercon Coffee Corp., invalidating insider releases in a proposed Chapter 11 plan on the basis that the releases were improper retention-related transfers. Check out this expertly drafted article discussing this decision.

Read now »

Related Content

• Executive Compensation and Severance Agreements in Bankruptcy
  Read this discussion of employment agreements antedating a bankruptcy filing and a debtor in possession’s proposed executive compensation and employee retention programs.

• Management in Chapter 11
  Review this practice note for an overview of DIP management responsibilities during a Chapter 11 case and the mechanisms to displace management.

• Motion to Approve Key Employee Incentive and Retention Plans
  Start with this template motion when representing a Chapter 11 debtor in possession seeking approval of a key employee incentive plan (KEIP) and/or a key employee retention plan (KERP).

• Order Approving KERP/KEIP Motion
  Use this template proposed order when filing a motion to approve a KEIP and/or KERP.

• Confirmation
  Read about the requirements for confirming a Chapter 11 plan.

• Chapter 11 Plan Confirmation Resource Kit
  Check out this resource kit for Practical Guidance materials on confirming a Chapter 11 plan, including detailed practice notes, templates, and checklists.

Practical Guidance Updates
Featuring the latest updates from your Practical Guidance account.

• Third-Party Release Tracker (Post-Purdue Pharma) – Keep track of how courts are treating third-party releases since the Supreme Court issued the Purdue Pharma
• DIP Financing Key Terms Tracker – Compare the key terms of over 25 DIPs!
• Mega Chapter 11 Filings Tracker (2024) – Stay up to date with new Mega filings, with over six new cases in August (so far).
• Subchapter V Decision Tracker – Keep up to date on key legal developments with three new cases in August (so far)!
• Law Firm Rates Tracker (Debtor Professionals Mega Bankruptcies)
• Debtor Professionals Mega Tracker
• Document alerts allow you to stay current on legal developments that affect your practice. Find out how to set up your document alerts. 
• Explore the Chevron Reversal Impact Resource Kit for analysis related to the Supreme Court’s decision to overturn four decades of deference to federal agency interpretations of ambiguous statutes.
• Generative Artificial Intelligence (AI) Resource Kit is a frequently updated collection of current Practical Guidance materials on generative AI, ChatGPT, and similar tools.
• Public Interest, Pro Bono, and Non-Profit Resource Kit offers valuable guidance for those providing pro bono legal services and assisting non-profit organizations and public interest groups. It includes useful content on topics including tenant's rights, fair housing and lending, discrimination, immigration, and general non-profit resources. 
• Legal Developments provide the latest updates and analyses of emerging topics impacting your practice area. Visit the Legal Developments page to see the latest topics, which also include breaking legal news and related Practical Guidance content.
• Review this guidance, AI and Legal Ethics: What Lawyers Need to Know, in the Summer Edition of the Practical Guidance Journal. Explore insights from a judge into the use of GenAI in civil litigation, including discovery issues, use cases, and key takeaways. Also advance your career with professional and business development guidance.
• Listen Up! The Practical Guidance and Law360 Podcasts Resource Kit features interviews with industry-leading attorneys on cutting edge issues in the law: NFTs, Cannabis, COVID-19, and more.
• Learn about the 2000+ leading attorney authors contributing to our 26 practice areas in the Practical Guidance Author Center. Interested in becoming a Practical Guidance author? Click here for details. Practical Guidance is committed to amplifying diverse voices of attorneys across all differences, including gender and race.

PRACTICAL GUIDANCE CUSTOMER EMAIL EDITION ON THE WEB

Experience results today with practical guidance, legal research, and data-driven insights—all in one place.

Experience Lexis+