In a recent decision in In re Nuverra Environmental Solutions, Inc., No. 18-3084, 2021 WL 50160 (3d Cir. Jan 6, 2021), a divided Third Circuit panel held that an appeal of a Chapter 11 plan confirmation order was equitably moot and that the dissenting unsecured creditor who filed the appeal, David Hargreaves, was not entitled to individualized relief.  Under the confirmed Chapter 11 plan in Nuverra, secured creditors did not receive payment in full and creditors that were holders of prepetition unsecured notes, including Hargreaves, received cash and securities equal to only six percent of the face value of their note claims, while trade creditors were entitled to be paid in full.  The plan proponents described the full payment to these unsecured trade creditors as a “gift” from the secured creditors, who were undersecured based on the debtors’ enterprise value under the plan.
Continue Reading Opinion of Interest – In re Nuverra Environmental Solutions, Inc.