Contact us now Call: (302) 652-1100 Fax: (302) 652-1111
1225 King St., Wilmington, DE 19801

DUANE WERB SUCCESSFULY ARGUED A CASE BEFORE THE US COURT OF APPEALS FOR THE THIRD CIRCUIT IN A CASE INVOLVING APPLICATION OF THE EQUITABLE MOOTNESS DOCTRINE IN CHAPTER 11 BANKRUPTCIES

Duane Werb, representing small Oklahoma “Mom and Pop” oil producers in the Semcrude Bankruptcy successfully argued an appeal before the United States Court of Appeals for the Third Circuit, resulting in a reversal of a decision by the United States District Court for the District of Delaware that had denied his clients the right to pursue a class action indefinitely and overruled their objection to a plan of confirmation in a Chapter 11 bankruptcy proceeding post confirmation. The lower court based its decision on a judge made, rather esoteric, doctrine of equitable mootness. Writing for the majority, District Judge Thomas Ambro, in explaining the doctrine, commented “Following confirmation of a plan by a bankruptcy court, an aggrieved party has the statutory right to appeal the court’s rulings. Nevertheless, if debtors or others believe granting the requested relief would disrupt the effected plan or harm third parties, they may seek to dismiss the appeal as equitably moot”. In conclusion, Judge Ambro stated: “ Dismissing an appeal as equitably moot should be rare, occurring only where there is sufficient justification to override the statutory rights of the party seeking review. Here, the evidentiary record does not support Debtor’s contention that a successful appeal would collapse their plan of reorganization or undermine the justifiable reliance of third parties to their significant harm. Holding otherwise was an abuse of discretion. We thus reverse the District Court’s dismissal and remand for it to hear Appellant’s appeal on its merits.” Upon remand to the District Court, the parties agreed to mediation, which resulted in a settlement, thereby concluding almost six years of protracted litigation.