Litigation Partner Justin DeCamp and associates Julie Kapoor and Matthew Marchello authored a Law360 article analyzing the Third Circuit’s recent decision in In re: Whittaker Clark & Daniels. The court affirmed that debtors in mass tort bankruptcies can use Chapter 11 to enter into broad settlements that resolve of third-party liability for derivative claims.
The decision reinvigorates the use of Chapter 11 to address nondebtor liability in mass tort bankruptcies following the Supreme Court’s 2024 Harrington v. Purdue Pharma LP ruling. The authors note that “… Whittaker shows that third parties subjected to mass tort litigation because of the business of an affiliated debtor can still obtain a large measure of closure via a settlement of derivative claims.”
Read: “3rd Circ. Clarifies Ch. 11 3rd-Party Liability Scope Post-Purdue”