Plain Meaning Rules: Did BAPCPA Abolish the Absolute-Priority Rule?

In this article, Stan Goldich discusses the recent decision of the Bankruptcy Appellate Panel for the Ninth Circuit in In re Friedman in which a split panel construed amendments made to section 1115 of the Bankruptcy Code by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. At issue is whether BAPCPA abolished the application of the absolute-priority rule to individual chapter 11 debtors. The BAP held that “a plain reading of §§ 1129(b)(2)(B)(ii) and 1115 together mandates that the absolute priority rule is not applicable in individual chapter 11 cases.”