Are Two Caps Better Than One? An Analysis of the Interplay Between §§ 502(b)(6) and 503(b)(7)

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Article
R. Stephen McNeill and D. Ryan Slaugh
ABI Journal

The bankruptcy case of In re Energy Future Holdings Corp. has generated a number of substantial disputes. While much of the controversy has involved make-whole, asbestos and confirmation issues, a less-publicized dispute involves the interplay between the lease caps found in §§ 502(b)(6) and 503(b)(7) of the Bankruptcy Code. Given the absence of case law on this topic, the U.S. Bankruptcy Court for the District of Delaware is faced with a unique opportunity to create foundational precedent on a multimillion-dollar issue.

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