IN RE: CORAM HEALTHCARE CORP. and CORAM, INC., Debtors., 315 B.R. 321

Summary

The debtors filed petitions for relief under Chapter 11 of the Bankruptcy Code, and the debtors' first proposed reorganization plan was denied because the debtors' CEO was also employed as a consultant by the debtor's largest noteholder, which presented a conflict of interest. The court confirmed the trustee's plan, as long as it was amended. The court held, inter alia, that: (1) although certain compromise settlements in the trustee's plans were supported by sufficient evidence and approved under Fed. R. Bankr. P. 9019, several of the proposed releases were not fair and equitable under 11 U.S.C.S. § 1123(b)(3)(A); (2) considering the parties' competing valuations, competing incentives, and divergent views, the value of the debtor was less than $ 317 million; (3) the debtors' noteholders were entitled to post-petition interest on their unsecured claims at the federal judgment rate under 28 U.S.C.S. § 1961(a); (4) the equity committee's plan was not confirmable because it improperly ...