The Third Circuit on Tuesday directed a Delaware bankruptcy judge to revisit a deal affecting the Chapter 11 plan of debt collector SCH Corp., agreeing with a group of class action claimants that the agreement was approved under the wrong standard.
The three-judge panel ruled that the bankruptcy court erred by treating the deal, which changed the structure of payments SCH’s unsecured creditors would receive under its liquidation plan, as a settlement rather than a post-confirmation modification. 3rd Circ. Says Debt Collector’s Ch. 11 Deal Not A Settlement was reported by Jamie Santo in today’s Law 360.