Panel: Mass Torts, Dischargeability, and Consent: the Availability of Third-Party Releases in Different Jurisdictions
Summary by Dr. Charles Ho Wang Mak – NextGen Class 2024
The session, " Mass Torts, Dischargeability, and Consent: the Availability of Third-Party Releases in Different Jurisdictions ", gathered an esteemed panel to navigate the contentious global landscape of third-party releases. Moderated by Hon. Lisa Beckerman, the discussion featured insights from Chad J. Husnick, Giuliano Colombo, and Ashley Taylor, who explored the divergent legal standards and the profound implications of the recent U. S. Supreme Court decision in Purdue Pharma. Chad J. Husnick framed the debate by outlining the U. S. perspective. He explained how third-party releases became an integral, albeit controversial, tool in Chapter 11 cases, designed to provide the certainty and finality needed to resolve complex mass tort litigation. Husnick detailed how the landmark Purdue Pharma ruling dramatically altered this practice by finding that the Bankruptcy Code does not authorize non-consensual releases of
non-debtor third parties, thereby compelling a re-evaluation of how large-scale resolutions can be structured. Providing comparative viewpoints, Ashley Taylor described the more cautious Canadian approach. He noted that under the Companies ' Creditors Arrangement Act( CCAA), Canadian courts grant third-party releases only in exceptional circumstances where they are proven to be fair and essential to the restructuring plan. In contrast, Giuliano Colombo explained that the concept is largely unavailable in Brazil, as its legal framework requires the explicit consent of every affected creditor, making non-consensual releases fundamentally incompatible with Brazilian law. In conclusion, the panellists agreed that while third-party releases have been a crucial mechanism for achieving global settlements in mass tort cases, their future is uncertain. The discussion highlighted a fundamental tension between the desire for comprehensive resolution and the protection of due process. The panel stressed that the path forward demands greater international coordination and clearer statutory frameworks to address the growing inconsistencies across jurisdictions.
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