Millennium Labs Bankruptcy Plan Stays on Track despite Lender Opposition
From - National Intelligence Report It has been nearly two years since Millennium went into Chapter 11 but the case continues to make news. After agreeing to… . . . read more
It has been nearly two years since Millennium went into Chapter 11 but the case continues to make news. After agreeing to pay $250 million to settle federal fraud claims for false billing of urine tests, Millennium Health LLC filed for bankruptcy in November 2015. During the bankruptcy proceedings, Millennium’s non-debtor shareholders worked out a deal with creditors. The debtors would fork over $325 million to pay the DOJ settlement in exchange for a broad release of all claims against them.
While most of the creditors went along, one group of lenders was virulently opposed to the deal. And since there was no opt-out they could use to escape, the opposing lenders cried foul and challenged the bankruptcy court’s legal authority to approve a release without the agreement of all the lenders.
The bankruptcy court overrode their objections and confirmed the plan. After pinballing around legal tribunals, the case landed back in the lap of the original bankruptcy court. Last week, the ruling came down: It is, in fact, okay for a Chapter 11 plan to release a non-debtor’s claims against a non-debtor, third-party even without releasing party’s consent. Translation: The release deal was still binding even against the lenders who opposed it.
The case is not necessarily over and the opposing lenders may file yet another appeal. But for now at least, the Millennium bankruptcy plan is a go despite virulent opposition by some lenders.
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