Releasing the Albatross

Last month, we discussed the fact that Chapter 11 cases can last for months or years after plan confirmation solely as a result of unresolved disputed claims. To address the speedy resolution of such claims, debtors have increasingly turned to mandatory "alternative dispute resolution" (ADR). We discussed the utilization of voluntary ADR by bankruptcy courts, and the implementation of ADR procedures. This month, we discuss The Sixth Circuit's Decision in Spierer v. Federated Department Stores, et al. (In re Federated Department Stores), 328 F. 3d 829 (6th Cir. 2003) (hereinafter, "Federated"), wherein the Sixth Circuit affirmed the power of the bankruptcy courts to implement mandatory ADR procedures