The Future Viability of 105(a) Injunctions Following the Supreme Court's Decision In 'Purdue Pharma'

Until now, a successful reorganization assumed the debtor could confirm a plan with nondebtor releases and injunctions based on less than full creditor consensus. Now that nonconsensual releases in Chapter 11 plans are no longer permitted, will debtors have a more difficult time obtaining a 105(a) injunction?

11 minute read August 01, 2024 at 12:11 AM
By
Theresa A. Driscoll
The Future Viability of 105(a) Injunctions Following the Supreme Court's Decision In 'Purdue Pharma'

The U.S. Supreme Court's recent decision in Purdue Pharma has put an end to the use of permanent plan injunctions in the form of nonconsensual third-party releases as a reorganizational tool in Chapter 11, at least for now.

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