Latest Case: In re: Energy Future Holdings Corp. (Bankruptcy)

Labor Board Wrongly Rejects Employee Access to Company Email for Organizational Purposes

SAMUEL ESTREICHER, CHRISTOPHER OWENS

NYU Law professor Samuel Estreicher and 3L Christopher S. Owens criticize a recent decision by the National Labor Relations Board (NLRB), in which it reversed course and rejected employee access to company email to discuss union issues. Estreicher and Owens explain that the NLRB commonly reverses its position on key policy issues such as this one when the political party in the White House changes, and they call for reforms that would make the administration of labor law more consistent and reliable.

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In re: Energy Future Holdings Corp.

Docket: 19-1430

Opinion Date: February 18, 2020

Judge: Krause

Areas of Law: Bankruptcy

The latency period for some asbestos-related diseases may last 40 years In bankruptcy, most classes of asbestos plaintiffs are divided between those who have already contracted an asbestos-related disease and those who have been exposed and are at risk but may not realize the fact of their exposure. Normally, a bankruptcy court sets a bar date before which proofs of claim against the estate must be filed; upon confirmation of a plan, all claims for which proofs are not filed are discharged. Under 11 U.S.C. 524(g) a court can deal with latent claims by establishing a trust and appointing a representative of future claimants’ interests. EFH, a holding company, and its subsidiaries filed a Chapter 11 bankruptcy petition. EFH’s holdings included Oncor, the largest electricity company in Texas. EFH could not sell Oncor alone without triggering massive tax liability; a buyer would need to acquire EFH’s other properties, including the Asbestos Debtors. A potential buyer proposed avoiding section 524(g) by relegating discharged claimants to the post-confirmation process. Federal Rule of Bankruptcy Procedure 3003(c)(3) provides that a bankruptcy court “shall fix and for cause shown may extend” the time within which proofs of claim may be filed; claimants may file after the bar date if they show “excusable neglect.” Latent asbestos claimants unsuccessfully argued that the plan would violate their due process rights. EFH implemented a notice plan for potential claimants. The bankruptcy court confirmed the plan, discharging claims that were not filed before the bar date. The Federal Circuit affirmed. Rule 3003(c)(3) is capable of affording latent claimants a fair opportunity post-confirmation to seek reinstatement of their claims The court noted the flaw in debtors attempting to circumvent section 524(g). This alternative route has produced a similar result as a section 524(g) trust but with unnecessary back-end litigation.