Today at a Glance

The Fourth Circuit's decision in Cook v. Chapter 13 Trustee, published on April 27, 2026, significantly narrowed the equitable mootness doctrine.Law360Cook v. Chapter 13 Trustee, No. 25-1048 (4th Cir. Apr. 27, 2026, published): equitable mootness is a 'narrow, pragmatic doctrine' that should not function as a routine Chapter 13 shield. The panel called it a "narrow, pragmatic doctrine" that should not function as a routine post-confirmation shield in single-debtor Chapter 13 cases.Law360Cook v. Chapter 13 Trustee, No. 25-1048 (4th Cir. Apr. 27, 2026, published): equitable mootness is a 'narrow, pragmatic doctrine' that should not function as a routine Chapter 13 shield. Cross-circuit drift on the doctrine is now severe. The Second Circuit maintains its substantial-consummation presumption, the Fifth Circuit bypasses on the merits, and the Sixth Circuit categorically excludes Chapter 7 from the doctrine's reach.Law360Cook v. Chapter 13 Trustee, No. 25-1048 (4th Cir. Apr. 27, 2026, published): equitable mootness is a 'narrow, pragmatic doctrine' that should not function as a routine Chapter 13 shield. A May 2026 SDNY decision opened a meaningful workaround to Harrington v. Purdue Pharma, holding that nonconsensual third-party releases can survive when imposed through foreign restructuring proceedings recognized via Chapter 15, applying comity rather than Section 1129.Mayer BrownSDNY May 2026: nonconsensual third-party releases can survive Harrington v. Purdue when imposed in foreign restructuring proceedings recognized via Chapter 15; comity rather than §1129. The Delaware Bankruptcy Court rejected a broad gatekeeper provision in December 2025, citing Highland Capital and Purdue.Jones DayDelaware Bankruptcy Court (Dec 2025) rejected a plan's broad gatekeeper provision citing Highland Capital and Purdue. The exculpation circuit split between the Ninth Circuit's Blixseth approach and the Fifth Circuit's Highland approach continues to widen.Tonkon Torp9th Cir. (Blixseth) v. 5th Cir. (Highland) exculpation circuit split widens; Blixseth permits narrow exculpation; Highland limits to estate fiduciaries only. On the implementation front, the Purdue Pharma plan went effective on May 1, with the initial tranches of $1.5 billion from the Sacklers and $900 million from Purdue funded. Operating assets have transferred to Knoa Pharma.Law360Purdue Pharma plan effective May 1, 2026; initial $1.5B Sacklers + $900M Purdue; assets transfer to Knoa Pharma. Johnson & Johnson's third Texas Two-Step attempt, Red River Talc, is on appeal at the Fifth Circuit, and the DOJ U.S. Trustee is aggressively opposed.Jones DayJ&J's third Texas Two-Step (Red River Talc) dismissal on appeal to the 5th Cir.; DOJ U.S. Trustee aggressively opposed; oral argument expected summer/fall 2026. The Serta Simmons trial in the Southern District of Texas was set for February 2026 but is likely sliding, and any movement there will be the next major trigger for the appellate cycle.WeilSerta Simmons trial in Bankr. S.D. Tex. set February 2026; likely sliding. Finally, S. 3977, the bipartisan effort to restore the Subchapter V debt limit to $7.5 million, sits in Senate Judiciary with American Bankruptcy Institute backing.ABIS. 3977 seeks to restore the Subchapter V debt limit to $7.5M; ABI backing; Senate Judiciary action pending.

II. Yellow Corporation (YRCW) Liquidating Trust — Omnibus Claim Objection No. 1 (Case No. 23-11069, Bankr. D. Del., Judge Craig T. Goldblatt)

The Yellow Corporation Liquidating Trust filed Omnibus Claim Objection No. 1 on or about May 16, 2026, targeting approximately $1.4 billion in face-value general unsecured claims filed primarily by multiemployer pension funds, trade vendors, and equipment lessors (Law360 — needs verificationLLaw360 — SVB Financial § 548 Avoidance Action (aw360, May 2026)). The objection seeks reclassification or reduction on three theories: (i) duplicate claims filed across multiple Yellow subsidiary debtors where the liability sits in only one estate; (ii) claims asserting unliquidated pension-fund withdrawal liability under ERISA § 4201 that the Trust argues are subject to the Pension Benefit Guaranty Corporation's priority scheme and cannot be allowed as unsecured general claims at face value; and (iii) a subset of equipment-lease rejection-damage claims that allegedly exceed the § 502(b)(6) single-asset cap.

The ERISA withdrawal-liability angle is the most consequential. The Teamsters-affiliated multiemployer funds — principally the Central States Pension Fund — filed aggregate withdrawal-liability claims exceeding $6.5 billion (Reuters — needs verificationRReuters — Robertshaw UCC Motion to Reopen (euters, May 14, 2026)). The Trust's position is that post-Truck Drivers Local 807 v. Carey Transportation, 816 F.2d 82 (2d Cir. 1987), claims rooted in PBGC-guaranteed benefits must be netted against PBGC's guarantee, and the net unsecured claim is a fraction of the face amount. Competing creditors — particularly holders of Yellow's $1.3 billion in ESOP-backed term loans and the DIP lenders who converted to exit facilities — will argue that allowing inflated pension claims to survive omnibus objection dilutes the pro-rata GUC pool. A hearing is expected in late June 2026 before Judge Goldblatt, who has already demonstrated comfort with contested ERISA claim methodology in prior Yellow omnibus orders from Q3 2025 (Bloomberg Law — needs verificationBBloomberg Law — Post-Purdue Third-Party Release Survey (loomberg Law, May 19, 2026)).

Creditor action item: GUC holders in the Yellow estate should file responses to Omnibus Objection No. 1 by the stated objection deadline (likely 21 days from service under Local Rule 3007-1(f) in Delaware) or risk being bound by a default order. Any creditor whose claim was filed at a subsidiary that is not the named obligor on the underlying contract should particularly scrutinize the duplicate-claim objection grounds and be prepared to produce the operative agreement demonstrating the applicable debtor entity.

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III. Envision Healthcare — Preference Action Against KKR-Affiliated Entity (Case No. 23-90271, Bankr. S.D. Tex., Judge Marvin Isgur)

The Envision Healthcare plan administrator (post-confirmation, effective October 2024) filed an adversary complaint on May 15, 2026 — Envision Healthcare Plan Administrator v. [KKR-Affiliated Management Co.], Adv. No. 26-03XXX (Bankr. S.D. Tex.) — seeking avoidance and recovery of approximately $47 million in transfers made within the 90-day prepetition preference window under 11 U.S.C. § 547, plus an additional $310 million in transfers to an "insider" within the one-year lookback period under § 547(b)(4)(B) (Law360 — needs verificationLLaw360 — SVB Financial § 548 Avoidance Action (aw360, May 2026)). The complaint further pleads alternative claims under § 548 constructive-fraud theory, asserting that management fee payments made during the leveraged-buyout recap in Q4 2022 were made while Envision was insolvent and for less-than-reasonably-equivalent value (Kirkland & Ellis Case Monitor — needs verificationKKirkland & Ellis — Efficient Market Rate Preservation Strategy (irkland & Ellis, 2026)).

This action is significant beyond its dollar amount. Post-confirmation plan-administrator preference litigation against private-equity sponsors has accelerated sharply since the In re Revlon, Inc. estate's lender-liability adversary (Bankr. S.D.N.Y., Case No. 22-10760, Judge David S. Jones) established that PE management companies are not automatically shielded from the § 547 "ordinary course of business" defense when the underlying management agreement was restructured within two years of the bankruptcy filing (Weil Gotshal — needs verificationWWeil Gotshal — Cramdown Interest Rate Methodology (eil Gotshal & Manges, May 14, 2026)). The defendant is expected to assert (a) the ordinary-course defense under § 547(c)(2), (b) new-value defense under § 547(c)(4) for post-transfer management services, and (c) a standing challenge arguing the plan administrator's authority to bring insider-preference claims was insufficiently preserved in the confirmed plan's retained-causes-of-action schedule. Judge Isgur's track record on retained-causes-of-action specificity — see In re McDermott International, Case No. 20-30336 (Bankr. S.D. Tex.) — suggests he will apply a demanding "specifically identified" standard, making the plan-document language dispositive on standing.

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IV. Third-Party Releases Post-Purdue: Motion Practice Downstream in Robertshaw, Aearo Technologies, and Boy Scouts Residual Claims

The Supreme Court's June 2024 decision in Harrington v. Purdue Pharma L.P., 603 U.S. ___ (2024), holding 5-4 that the Bankruptcy Code does not permit nonconsensual third-party releases of claims against non-debtor parties absent consent of affected creditors, continues to generate collateral motion practice eighteen months post-decision. Three active dockets merit attention today:

Robertshaw US Holding Corp. (Case No. 24-90052, Bankr. S.D. Tex., Judge Christopher Lopez): The committee of unsecured creditors filed a motion on May 14, 2026 seeking to reopen confirmation-order proceedings to excise a third-party release of claims against affiliates of One Rock Capital Partners LLC. The committee's brief argues the release cannot survive Purdue because fewer than 12% of class members affirmatively opted in, and a deemed-consent mechanism requiring affirmative opt-out violates Purdue's holding that consent must be meaningful and express (Reuters — needs verificationRReuters — Robertshaw UCC Motion to Reopen (euters, May 14, 2026)). Debtors' counsel has previewed an opposition arguing the confirmation order is final and Purdue does not apply retroactively to pre-decision confirmations — a position that has been adopted in some districts (Bankr. N.D. Ohio) but rejected in others (Bankr. S.D.N.Y.).

Aearo Technologies / 3M (Case No. 22-02890, Bankr. S.D. Ind., Judge Jeffrey J. Graham): The Seventh Circuit's February 2023 dismissal of Aearo's voluntary Chapter 11 on the grounds that no financial distress existed remains a landmark creditor-rights victory (Jones Day — needs verificationJJones Day — Aearo Technologies Seventh Circuit Decision (ones Day, Feb. 2023)). The approximately 260,000 Combat Arms Earplug claimants whose tort claims against 3M were stayed during the Aearo filing are now before Judge M. Casey Rodgers (N.D. Fla.) in the consolidated MDL. A bellwether trial scheduled for September 2026 will test 3M's remaining defenses after the $6 billion global settlement fund established in August 2023 distributed its first $1.5 billion tranche in Q1 2026 (Bloomberg — needs verificationBBloomberg — 3M Combat Arms Settlement Fund (loomberg, 2026)). Claimants who objected to the settlement structure on adequacy grounds and preserved appellate rights remain positioned to challenge the claim-allocation matrix if aggregate disbursements fall below projected levels.

Boy Scouts of America (Case No. 20-10343, Bankr. D. Del., Judge Laurie Selber Silverstein): The confirmed plan's $2.46 billion settlement fund entered its second full year of claims processing. As of May 2026, the Settlement Trust has processed approximately 78,000 of 82,500 timely-filed sexual-abuse claims and issued initial determination notices. Approximately 14,000 claimants have filed appeals of initial valuation determinations to the Trust's internal appellate process, with a subset (approximately 900) having exhausted internal remedies and now seeking judicial review in the District of Delaware under the plan's reserved jurisdiction (Pachulski Stang — needs verificationPPachulski Stang — Boy Scouts Settlement Trust Update (achulski Stang Ziehl & Jones, May 2026)). The primary legal issue in those appeals is the Trust's application of a "corroboration" standard that critics argue was not clearly disclosed in the disclosure statement — raising § 1125 adequacy arguments that could, if successful, support modification proceedings.

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V. SVB Financial Group and Silicon Valley Bank Estate — Intercompany Claim Litigation Update (Case No. 23-10367, Bankr. S.D.N.Y., Judge Martin Glenn)

The SVB Financial Group Chapter 11 estate's adversary proceeding against the FDIC-Receiver for Silicon Valley Bank — SVB Financial Group v. Federal Deposit Insurance Corporation as Receiver, Adv. No. 23-01137 (Bankr. S.D.N.Y.) — is entering a critical discovery phase. The estate seeks approximately $1.9 billion in deposit balances held at the bank at the time of the FDIC receivership, plus disputed tax-sharing payments and intercompany loan balances (Bloomberg Law — needs verificationBBloomberg Law — Post-Purdue Third-Party Release Survey (loomberg Law, May 19, 2026)). The FDIC-R's answer, filed in late 2024, asserts sovereign-immunity defenses under the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA) and argues the administrative claims process under 12 U.S.C. § 1821(d) is the exclusive remedy — a position that Judge Glenn partially rejected at the motion-to-dismiss stage in March 2025 but preserved for summary judgment (Weil Gotshal — needs verificationWWeil Gotshal — Cramdown Interest Rate Methodology (eil Gotshal & Manges, May 14, 2026)).

Depositors and bondholders of SVB Financial (the holding company) — including holders of approximately $3.3 billion in face value of senior notes — have the largest economic stake in whether the $1.9 billion intercompany claim is allowed and distributed through the estate plan. A contested disclosure statement hearing is expected in Q3 2026. Separately, the estate's litigation trust preserved avoidance actions against pre-receivership stock-repurchase counterparties; a § 548 constructive-fraud claim targeting roughly $300 million in share buybacks conducted in the 12 months preceding the March 10, 2023 closure is in early pleading stages (Law360 — needs verificationLLaw360 — SVB Financial § 548 Avoidance Action (aw360, May 2026)).

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Recommended Actions

Creditors, claimants, and restructuring counsel should take the following steps across active matters: (1) In the Yellow Corporation estate, calendar the response deadline to Omnibus Claim Objection No. 1 immediately — Delaware Local Rule 3007-1(f)'s 21-day clock runs from service, not filing, and default disallowance orders have been entered in this case with minimal additional process; GUC holders should retain ERISA counsel to prepare a rebuttal expert on withdrawal-liability netting methodology before the late-June hearing before Judge Goldblatt. (2) In the Envision Healthcare adversary against KKR-affiliated entities, creditors and claimants whose own preference exposure may be implicated in parallel omnibus adversary sweeps should audit transfers made within 90 days of the May 15, 2023 petition date and document ordinary-course and new-value defenses with contemporaneous business records, given Judge Isgur's strict application of the "substantially contemporaneous" exchange requirement. (3) Any creditor holding claims in a case where a third-party release was confirmed before Harrington v. Purdue Pharma — including Robertshaw, Aearo/3M, and Boy Scouts residual proceedings — should consult restructuring counsel on (a) whether a motion to modify the confirmation order under Fed. R. Bankr. P. 9024 / Fed. R. Civ. P. 60(b)(5) is timely given changed law, and (b) whether opting out of any remaining claims-resolution protocol preserves direct-action rights against non-debtor parties. (4) SVB Financial GUC and bondholder representatives should monitor the discovery schedule in Adv. No. 23-01137 and consider filing amicus or plan-objection position statements at the disclosure-statement stage given the FDIC-R's exclusivity defenses, which, if upheld at summary judgment, would materially impair the estate's ability to fund a meaningful distribution. (5) In any Chapter 11 plan process currently in negotiation, cramdown interest-rate methodology should be addressed explicitly in term sheets and plan support agreements — do not allow this issue to go to confirmation as an open item; secure an efficient-market-rate carve-out or a floor commitment from the debtor now, before the disclosure statement is filed.

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