Judge Refuses Washington Mutual Bankruptcy Confirmation


For the second time, bank holding company Washington Mutual was refused a confirmation of their reorganization efforts by bankruptcy judge Mary Walrath in Delaware without first engaging in mediation with various creditor groups. Judge Walrath brought up several reasons for her decision that included claims by a committee of equity security holders that hedge funds supporting the plan had engaged in insider trading of WMI debt based on information they obtained during the bankruptcy.

As such, Judge Walrath ordered the various warring parties to resolve their differences through a mediator without letting the three year old bankruptcy case degenerate into a “litigation morass.” The parties concerned are several creditor groups (including the committee of equity security holders), the hedge funds and Washington Mutual’s committee of unsecured creditors.

In response, Washington Mutual filed a court filing this week in which it gave its assurance it would make several modifications such as the interest rate to be paid to creditors.

Please see full article below for more information.

LOADING PDF: If there are any problems, click here to download the file.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Tampa Bay Bankruptcy Center, P.A. | Attorney Advertising

Written by:


Tampa Bay Bankruptcy Center, P.A. on:

Popular Topics
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.

Already signed up? Log in here

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.