U.S. District Judge Vincent Briccetti has upheld the confirmation of a bankruptcy plan that slashed $3 billion in debt from Momentive Performance Materials Inc.’s balance sheet. In what Law360 refers to as a “monumental decision that undermines senior creditors’ leverage to set restructuring terms,” Judge Briccetti rejected vehement objections to a bankruptcy exit plan that allowed Momentive to emerge from bankruptcy while paying off senior bondholders with new debt at below-market interest rates. The ruling bolstered the idea that senior creditors should not profit from debt issued in a restructured entity.

Partner Seth Lieberman and Associate Patrick Sibley, both members of Pryor Cashman’s Bankruptcy, Reorganization & Creditors’ Rights Group, represented the second lien noteholders in both the Bankruptcy Court and before Judge Vincent Briccetti in the U.S. District Court for the Southern District of New York.

Law360 discusses the case, In re: MPM Silicones LLC et al., and Judge Briccetti’s May 4, 2015 decision in its article “Momentive's Watershed Ch. 11 Plan Withstands Attack.”

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