Morgan Liptak

Document Type

Research Memorandum

Publication Date




Under section 1123(a)(4) of title 11 of the United States Code (the “Bankruptcy Code”), a plan of reorganization must “provide the same treatment for each claim or interest of a particular class, unless the holder of a particular claim or interest agrees to a less favorable treatment of such particular claim or interest.” The Supreme Court has never interpreted this provision, nor has the Bankruptcy Code defined the standard of equal treatment. As a result, the circuit courts have created a standard for what exactly the equal treatment rule requires.

The first part of this memorandum discusses what the section 1123(a)(4) equal treatment rule actually requires, and the second part analyzes how four circuit courts have interpreted this rule to find that a plan of reorganization can, in fact, treat class members differently, as long as certain criteria are met.


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