# In Re Dow Corning Corp.

> District Court, E.D. Michigan · November 13, 2000 · 255 B.R. 445

URL: https://www.frixlaw.com/law-library/cases/1961422

## Case

- **Full name:** In Re DOW CORNING CORPORATION, Debtor
- **Court:** District Court, E.D. Michigan
- **Decided:** November 13, 2000
- **Citations:** 255 B.R. 445; 2000 U.S. Dist. LEXIS 16385; 2000 WL 33321424
- **Precedential status:** Published
- **Opinion:** Opinion by Hood
- **Judges:** Hood
- **Cited by:** 59 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/1961422

## How later opinions describe it (automated extraction)

- finding that a claimant who elects to settle instead of pursuing litigation agrees to a less favorable treatment and is in compliance with § 1123(a)(4)

## Opinion text

OPINION RELATING TO APPEALS FROM AND MOTIONS REGARDING THE BANKRUPTCY COURT’S NOVEMBER 30, 1999 CONFIRMATION ORDER
HOOD, District Judge.
I.
INTRODUCTION
On May 15, 1995, the Debtor Dow Corning Corporation (“Dow Corning” or “the Debtor”) filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code. The Debtor submitted two plans of reorganization before negotiating with various parties, including the Official Committee of Tort Claimants (the “Tort Claimants’ Committee”). On November 8, 1998, the Debtor and the Tort Claimants’ Committee (the “Proponents”) submitted a Joint Plan of Reorganization, amended on February 4, 1999. The Bankruptcy Court held hearings on the confirmation of the Amended Joint Plan over the course of several weeks, commencing on June 28, 1999, with closing arguments heard on July 30, 1999. Testimonies were taken and evidence submitted during the hear
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ings. Numerous briefs and documents were filed by many parties in support of or in opposition to the confirmation of the Amended Joint Plan, including post-hearing briefs.
The Bankruptcy Court entered its Findings of Fact and Conclusions of Law and Order Confirming the Amended Joint Plan on November 30, 1999. The Bankruptcy Court also entered various opinions on this date. The Bankruptcy Court indicated that subsequent opinions would be entered in the future and on December 21, 1999, the Bankruptcy Court entered an opinion on the release and injunction issue, the best-interests-of creditors test, feasibility and whether the plan complies with other provisions of the Bankruptcy Code. In all, seven separate opinions were entered relative to the November 30, 1999 Confirmation Order.
1
Not all of the parties or all of the issues in the opinions were appealed. The Court will address the opinions appealed from below.
The following parties filed appeals and/or motions relating to the Confirmation Order which are currently before the Court:
2
Case No. Date filed with Bankruptcy Court Appellant/Movant
99-CV-73941 August 9, 1999 Certain Foreign Claimants
99-CV-74218 August 25, 1999 Korean Claimants
99-CV-75380 November 5, 1999 United States of America
99-CV-75799 December 1, 1999 United States of America
99-CV-75922 December 9, 1999 Physician Claimants
99-CV-75923 December 8,1999 New Zealand Claimants
99-CV-75924 December 9,1999 Class Five Nevada Claimants
99-CV-75925 December 9, 1999 Class Five Texas Children Claimants represented by the Lacy firm
99-CV-75927 December 9, 1999 Australian Claimants
99-CV-75929 December 10, 1999 Certain Foreign Claimants represented by the Shainwald firm
99-CV-75930 December 8,1999 Official Committee of Physician Creditors
99-CV-75958 December 10, 1999 Helene D. Schroeder,
pro se
99-CV-75959 December 10, 1999 Sue Olexa,
pro se
99-CV-75960 December 10, 1999 Marti Jacobs,
pro se
99-CV-76007 December 13, 1999 Beatrix Shishido,
pro se
99-CV-76008 December 13, 1999 Karen L. Hustead
99-CV-76009 December 13, 1999 Pamela Dowd,
pro se
and Maribeth West,
pro se
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99-CV-7606B December 16, 1999 Class Five Pennsylvania Claimants, Pennsylvania Coordinated Silicone Breast Implant Litigation
99-CV-76214 Dow Chemical December 29, 1999
99-CV-76215 Corning, Inc. December 29, 1999
00-CV-70029 Dow Corning and Official Committee of Tort Claimants December 30, 1999
00-CV-70076 Rita Altig, et al. December 30, 1999
00-CV-70176 Hartford Accident & Indemnity Co., et al. January 10, 2000
00-CV-70177 Lloyds of London, et al. January 10, 2000
00-CV-70178 Korean Claimants January 10, 2000
00-CV-70179 Dow Corning and Official Committee of Tort Claimants’ Motion to Withdraw the Reference January 6, 2000
00-CV-70337 Dow Chemical January 19, 2000
00-CV-70338 Corning, Inc. January 19, 2000
The general issues on appeal include: the classification and treatment of claims; the injunction and release; the cap on punitive damages; whether the proposed plan is fair; and the United States’ motion to compel. This Court entered an order consolidating the briefing schedule of all the appeals relating to the Confirmation Order entered by the Bankruptcy Court. On April 12 and 13, 2000, the Court held hearings on the appeals, allowing counsel representing the appellants and appellees,
pro se
individuals and other interested parties to present arguments. Some parties filed supplemental briefs after the hearings. For the reasons set forth below, the Court AFFIRMS the Bankruptcy Court’s November 30, 1999 Confirmation Order and REVERSES in part its December 21, 1999 Opinion on the Injunction and Release issue as it relates to the November 30,1999 Order.
II.
BACKGROUND
In 1943, The Dow Chemical Company (“Dow Chemical”) and Corning Glass Works (now Corning, Incorporated (“Corning, Inc.”)), formed Dow Corning Corporation for the purpose of developing and producing products based on silicone chemistry. Today, Dow Holdings, Inc. (a wholly owned subsidiary of Dow Chemical) and Corning, Inc. are the sole shareholders of the Debtor, each owning 50% of the Debtor’s common stock.
See generally In re Dow Corning Corp.,
187 B.R. 919 (E.D.Mich.1995),
rev’d in part,
103 F.3d 129 (6th Cir.1996) and
In re Dow Corning Corp.,
211 B.R. 545, 550 (Bankr.E.D.Mich.1997).
The Debtor and its subsidiaries produce thousands of silicone-based products both for non-medical and medical uses. In the early 1960s, Drs. Thomas Cronin and Frank Gerow, plastic surgeons, developed the idea of placing silicone gel inside a sealed packet which would be surgically implanted inside a woman’s breasts and collaborated with the Debtor to create what is now known as a silicone-gel breast implant.
In re Dow Corning Corp.,
211 B.R. at 550 . The Debtor introduced silicone-gel breast implants to the market in 1964.
Id.
There were problems with the breast implants, including leakage and rupture.
Id.
As a result of various complaints, inserts were placed in the packages warning recipients of the potential non-pathogenic side effects.
Id.
at 551 . The Debtor did not face significant legal actions during this time period because of the warnings in the packets.
Id.
Reports in the 1980s suggested that silicone gel may cause systemic disease in humans.
Id.
Women began filing lawsuits during this period alleging that silicone gel caused an auto-immune connective tissue disease such as lupus, Scleroderma or rheumatoid arthritis.
Id.
Later on, suits were filed alleging symptoms such as
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aches and pains, fatigue, insomnia, memory loss and headaches.
Id.
After a successful suit against the Debtor in 1984, the Debtor modified its package inserts acknowledging that there were “reports of suspected immunological responses to silicone mammary implants” and that “convincing evidence does not exist to support a causal relationship between exposure to silicone materials and the acquisition or exacerbation of a variety of rheumatic and connective tissue disorders.”
Id.
(citation omitted)
The Debtor ceased marketing the silicone gel for breast implantation in March of 1992. Two months later, the Food and Drug Administration (“FDA”) ordered that implants containing the gel be taken off the market.
Id.
After the implants were withdrawn from the market, lawsuits against breast implant manufacturers dramatically increased with more than 3,000 suits filed against the Debtor in 1992, followed by 8,000 and 7,000 new cases in 1993 and 1994, respectively.
Id.
Lawsuits were also filed in Canada against the Debtor.
Id.
In 1992, the Judicial Panel on Multidis-trict Litigation consolidated all the breast implant litigation brought in federal courts for administration of pre-trial matters pursuant to 28 U.S.C. § 1407 .
In re Silicone Gel Breast Implants Prods. Liab. Litig.,
793 F.Supp. 1098 (Jud.Pan.Mult.Lit.1992). MDL-926 was assigned to the Honorable Sam C. Pointer, Jr. of the Northern District of Aabama.
3
Efforts were made to achieve a global settlement in the MDL-926 which led to a proposed $4,225,070,000 global settlement which was approved by Judge Pointer in 1994.
Lindsey v. Dow Corning Corp. (In re Silicone Gel Breast Implant Prods. Liab. Litig.),
No. CV 92-P-10000-S, Civ. A. No. CV94-P-11558-S, 1994 WL 578353 , at *1 (N.D.Ala. Sept.1, 1994). The Debtor had agreed to contribute $2.02 billion to the global settlement. Approximately 440,000 women filed claims with the global settlement fund in 1995, many more than were anticipated by the parties. Based on the number of claims filed, the claimants would have received only a small percentage of what was previously promised. Some estimated that the defendant manufacturers would have had to jointly contribute another $24 billion to the settlement fund to pay all the claimants the amount promised.
In re Dow Corning Corp.,
211 B.R. at 552 . More than 15,000 class members chose to opt out of the proposed settlement to preserve their right to pursue individual trials.
Id.
The global settlement fell apart in 1995.
The Debtor, faced with approximately 90 state trials in breast implant suits in 1995 with overlapping dates, believed that it would be financially and logistically impossible to defend itself.
Id.
In 1994 alone, the Debtor claimed it incurred more than $200 million in litigation costs.
Id.
The Debtor also faced a number of lawsuits involving nonbreast implant medical products.
Id.
at 553 . As a result of its legal predicament, the Debtor filed chapter 11 bankruptcy on May 15, 1995. At that time, the Debtor was a defendant in over 19,000 individual silicone-gel breast implant class actions, 45 putative silicone-gel breast implant class actions, and 470 lawsuits involving nonbreast implant medical products at the time it filed its petition.
Id.
Immediately after filing for bankruptcy, the Debtor sought to transfer all of the breast implant actions to the Eastern District of Michigan, including actions against its two shareholders, Dow Chemical and Coming, Inc. Other breast implant manufacturers, including Medical Engineering Corporation/Bristol-Myers Squibb, Minnesota Mining and Manufacturing Company and Baxter Healthcare Corp. and Baxter International, Inc. also requested that the cases against them be transferred to this Court. This Court granted the Debtor’s request as to the claims against the Debtor
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but denied the transfer relating to the claims against the Debtor’s shareholders and the non-Debtor breast implant manufacturers.
See In re Dow Corning Corp.
187 B.R. at 931 -32 and
Memorandum Opinion and Order on the Non-Debtors’ Motion to Transfer,
Case No. 95-CV-72397-DT (E.D.Mich. Sept. 12, 1995). The Sixth Circuit reversed this Court holding that the Court had jurisdiction over the Debtor’s shareholders and the non-Debtor breast implant manufacturers and remanding the matter in order that this Court analyze the transfers under abstention principles.
See Lindsey v. O’Brien, Tanski, Tanzer and Young Health Care Providers of Connecticut (In re Dow Corning Corp.),
86 F.3d 482, 493-94 (6th Cir.1996). On remand, this Court declined to exercise jurisdiction over the Debtor’s shareholders and the non-Debtor breast implant manufacturers based on abstention principles.
See In re Dow Corning Corp.,
No. 95-CV-72397-DT, 1996 WL 511646 (E.D.Mich. July 30, 1996). On a Writ of Mandamus motion, the Sixth Circuit reversed this Court’s ruling only with respect to the Debtor’s shareholders.
See Lindsey v. Dow Chemical Co. (In re Dow Corning Corp.),
113 F.3d 565 (6th Cir.1997). This Court thereafter entered an Order Transferring all breast implant claims against Dow Chemical and Corning, Inc. to the Eastern District of Michigan.
See Order Transferring Breast Implant Cases,
Case No. 95-CV-72397-DT (E.D.Mich. May 13, 1997). To date, there are approximately 14,795 breast implant cases against Dow Chemical and Corning, Inc. filed before this Court. The transferred cases before this Court against Dow Chemical and Corning, Inc. are currently held in abeyance pending the outcome of the Debtor’s bankruptcy action.
The Debtor has since proceeded with its bankruptcy action. The United States Trustee appointed various committees, including the Official Committee of Tort Claimants which represented the interests of the thousands of personal injury claimants before the Bankruptcy Court. The other committees appointed by the United States Trustee included the Official Committee for the Commercial Claimants and the Official Committee for the Physician Claimants. The Debtor proposed two plans of reorganizations which were vigorously opposed by the Tort Claimants’ Committee. This Court and the Bankruptcy Court, appointed a Mediator, Professor Francis E. McGovern, to assist in the negotiation of a consensual Plan between the Debtor, the Bankruptcy Committees, the United States Trustee, Dow Chemical and Corning, Inc.
See Order Appointing Mediator,
Case No. 97-CV-00001-DT (E.D.Mich. Nov. 11, 1997). The Debtor thereafter began to seriously negotiate with the various Committees, especially the Tort Claimants’ Committee, which resulted in the proposed Amended Joint Plan filed by the Debtor and the Tort Claimants’ Committee, which is currently before the Court for review.
The Court will address the following issues below: the appealability of the December 21, 1999 Opinion; the release and injunction decision addressed in the December 21, 1999 Opinion; the parties’ specific arguments relating to the release and injunction; classification, treatment, fairness standards, and the best-interest-of creditors test; each parties’ specific arguments relating to the classification, treatment, fairness, and the best-interest-of creditors test; the United States’ appeal from the order addressing its motion to compel; the Case Management Order; and motions to intervene and/or file
ami-cus
briefs.
III.
JURISDICTION AND STANDARD OF REVIEW
The district court has jurisdiction over appeals from final orders of the bankruptcy court in core proceedings. 28 U.S.C. §§ 157 (b)(1) and 158(a)(1). The confirmation of a plan is a core proceeding. 28 U.S.C. § 157 (b)(2)(L). A bankruptcy court’s findings of fact are reviewed under
*464
a clearly erroneous standard, while its conclusions of law are reviewed
de novo. Mapother & Mapother, P.S.C. v. Cooper (In re Downs),
103 F.3d 472, 476-77 (6th Cir.1996); Bankr.R. 8013. Where a bankruptcy court’s determination involves a mixed question of fact and law, the district court “must break it down into its constituent parts and apply the appropriate standard of review for each part.”
Wesbanco Bank Barnesville v. Rafoth (In re Baker & Getty Fin. Servs., Inc.),
106 F.3d 1255 , 1259 (6th Cir.1997)
(citing Investors Credit Corp. v. Batie (In re Batie),
995 F.2d 85, 88 (6th Cir.1993)).
IY.
MOTIONS TO INTERVENE AND/OR TO FILE AMICUS BRIEF
The Pennsylvania Physicians and Hospitals filed a Motion to Intervene in the appeal of the Class 5 Pennsylvania Claimants. Uneeda Laitinen,
pro se,
an implant claimant, also filed a Motion to Intervene in the appeals of the Dow Corning Plan for Reorganization. The Washington Legal Foundation filed a Motion to File Brief as
amicus curiae
in support of the Proponents’ position regarding the Bankruptcy Court’s December 21,1999 Opinion.
The parties seeking intervention cite Fed.R.Civ.P. 24 as authority to intervene in the appeals. Rule 24 allows intervention as of right or by permission in an “action” before the district court.
See
Fed.R.Civ.P. 24(a) and (b). “Action” is defined as a “[cjivil action ... commenced by filing a complaint with the court.” Fed.R.Civ.P. 2 and 3.
In the Motions to Intervene before this Court, the parties seek intervention in “appeals” filed by certain parties from the Bankruptcy Court. The parties are not seeking to intervene in “actions” currently before the Court which were filed by way of a “complaint” but are seeking to intervene in “appeals” filed in this Court. The parties seeking to intervene have not cited any authority nor has this Court found any such authority, which would allow this Court, sitting as an appellate court, acting under the jurisdiction conferred to district courts by 28 U.S.C. § 158 (a) to allow intervention. Bankruptcy Rules 8001 and 8002 set forth the manner in which a party may file an appeal from a bankruptcy court’s order. If any party does not follow the rules regarding filing appeals from bankruptcy court orders, the Court does not have jurisdiction over that party on appeal under 28 U.S.C. § 158 (a). “If a timely notice of appeal is not filed, no appeal may be taken later.”
See
Committee Note, Bankr.R. 8002. The parties seeking to intervene in the appeals have not shown that this Court has the authority to allow non-parties to the appeal to intervene on appeal. The Court’s interpretation of Fed.R.Civ.P. 24 is not authority for this Court to allow parties to intervene on appeal. Rule 24 applies to an original civil action filed before this Court by way of a complaint and not by way of a bankruptcy appeal. The Court will not allow the Pennsylvania Physicians and Pennsylvania Hospitals and Uneeda Laitinen to intervene on appeal. The Court, however, will consider the briefs as motions to file an
amicus curiae
brief.
Appellate courts have allowed briefs of an
amicus curiae.
The Federal Rules of Appellate Procedure 29 sets forth the manner in which an
amicus curiae
brief may be filed.
Amicus curiae
briefs may be filed only by leave of court or by consent of the parties stated in the brief. Fed.R.App.P. 29(a). The motion to file an
amicus curiae
brief must be accompanied by the proposed brief and state the movant’s interest
and
the reason why an amicus brief is desirable and why the matters asserted are relevant to the disposition of the case. Fed.R.App.P. 29(b).
The Pennsylvania Physicians and Hospitals’ brief states that their interest in the appeals stem from the Bankruptcy Court’s December 21, 1999 Opinion regarding the release and injunctive issues. They state that neither the Proponents nor
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any other party have addressed their concerns that the December 21, 1999 Opinion may affect the physicians and hospitals’ rights under the Amended Joint Plan. The Pennsylvania Physicians and Hospitals argue that their brief is therefore desirable and relevant to the disposition of the case. The Court finds that the Pennsylvania Physicians and Hospitals’ brief addresses issues affecting the rights of the physicians and hospitals which no other party has raised before this Court with respect to the December 21, 1999 Opinion. The Pennsylvania Physicians and Hospitals’ brief will be allowed as an
amicus curiae
brief.
Uneeda Laitinen’s Motion for Intervention, received by the Clerk’s Office on April 12, 2000, is essentially a concurrence with the arguments Appellant Marti Jacobs has brought before the Court. Laitinen, as a claimant in the bankruptcy proceeding, does have an interest in the appeals before the Court. Although not particularly helpful to the Court, to the extent that Laitinen seeks to place on the record her concurrence with Jacobs’ position on appeal, the Court will allow Laiti-nen to so state on the record by allowing her “Motion for Intervention” to be filed as an
amicus curiae
brief.
The Washington Legal Foundation states that its interest in the appeals before the Court are twofold: 1) it has an interest in opposing the proliferation of product-liability class actions as a threat to free enterprise and prosperity; and 2) that the rule of law be upheld involving in bankruptcy laws. The Washington Legal Foundation believes that their brief would assist the Court and its views are relevant to the appeals. The Tort Claimants’ Committee responded to the Washington Legal Foundation’s motion stating that it has no objection if the Court wishes to accept the proposed
amicus curiae
brief but the Tort Claimants’ Committee makes it clear that it only agrees with the Washington Legal Foundation’s conclusion and not the basis for the conclusion. The Nevada Claimants oppose the Washington Legal Foundation’s brief because they claim the brief would not assist the Court but merely advocates for the Shareholders. The Court will allow the Washington Legal Foundation’s brief as an
amicus curiae
because it does have an interest in the appeals and the brief is relevant to the issues before the Court on appeal.
V.
UNTIMELY NOTICE OF APPEAL
In its January 24, 2000 Scheduling Order regarding the appeals, the Court allowed parties to file motions to dismiss any pending appeal. Other than the motion to dismiss filed by the United States, no other motions were filed to dismiss any pending appeal. Other than the United States’ motion to dismiss addressed by the Court above, the issue of whether certain parties filed timely Notices of Appeal was not argued vigorously by any party. Because filing a notice of appeal is jurisdictional, the Court will determine whether a party’s filing of the notice of appeal was timely.
Bankruptcy Rule 8002(a) provides that a “notice of appeal shall be filed with the clerk within 10 days of the date of the entry of the judgment, order, or decree appealed from.” Generally, a bankruptcy judge may extend the time for filing the notice of appeal if the request is made by a written motion and filed before the time for filing a notice of appeal has expired. Bankr.R. 8002(c)(1) and (2). However, the bankruptcy judge cannot extend the time for filing a notice of appeal if the order confirms a plan. Bankr.R. 8002(c)(1)(F). The 10 day period of time begins to run the day after the entry of the order and includes intermediate weekends and legal holidays. Bankr.R. 9006(a). The last day of the period is also included, unless it is a weekend day or a legal holiday.
Id.
As the rule is jurisdictional, failure to file a timely notice requires an appeal be dismissed for lack of jurisdiction.
Walker v. Bank of Cadiz (In re LBL Sports Ctr., Inc.),
684 F.2d 410, 412 (6th Cir.1982). The rule has been strictly construed, requiring strict
*466
compliance with its terms.
Hotel Syracuse, Inc. v. City of Syracuse Indus. Dev. Agency (In re Hotel Syracuse, Inc.),
154 B.R. 13, 15 (N.D.N.Y.1993). The notice of appeal itself is not a request for an extension under Rule 8002 since a request must be made by motion.
See Pryor v. Marshall,
711 F.2d 63, 64-65 (6th Cir.1983) (holding Fed.R.App.P. 4(a)(5) requires an appellant to file a timely motion requesting an extension of time).
4
Delays due to the mail are not grounds for excusable neglect.
See In re LBL Sports Center, Inc.,
684 F.2d at 412 . The Sixth Circuit has noted that although a person proceeding
pro se
may not fully understand the rules or procedure, he or she is still required to comply with the rules and that a
pro se
status does not exempt a person from complying with the rules.
See Jourdan v. Jabe,
951 F.2d 108, 110 (6th Cir.1991).
A review of the record before the Court and the Bankruptcy Court, indicates that Notices of Appeal listed below were not timely filed, therefore, the Court has no jurisdiction over those appeals. A party seeking an appeal from the November 30, 1999 Confirmation Order must have filed a notice of appeal before the Bankruptcy Court on or before December 10, 1999. A notice of appeal from the December 21, 1999 Opinion must have been filed on or before January 3, 2000 (the New Year holiday, January 1, a Saturday, was observed on December 31, 1999). The following appeals were untimely filed and will be dismissed for lack of jurisdiction:
Case No. Date filed with Bankruptcy Court Appellant
99-CV-76007 December 13, 1999 Beatrix Shishido,
pro se
99-CV-76008 December 13, 1999 Karen L. Hustead,
pro se
99-CV-76009 December 13, 1999 Pamela Dowd,
pro se
and Maribeth West,
pro se
99-CV-76063 December 16, 1999 Class Five Pennsylvania Claimants, Pennsylvania Coordinated Silicone Breast Implant Litigation
0-CV-70076 December 30, 1999 Rita Altig, et al.
0-CV-70176 January 10, 2000 Hartford Accident & Indemnity Co., et al.
00-CV-70177 January 10, 2000 Lloyds of London, et al.
Appellants Shishido, Hustead, Dowd and West, the Class Five Pennsylvania Claimants, and the Altig Claimants filed their notices of appeal from the November 30, 1999 Confirmation Order beyond the 10 day appeal time period of December 10, 1999. Although the Altig Claimants’ Notice of Appeal indicates they were appealing from the Bankruptcy Court’s December 21, 1999 Opinion, the substance of their appeal goes to the issues addressed in the November 30, 1999 Confirmation Order and not to the issues raised in the December 21,1999 Opinion which modified the November 30,1999 Confirmation — specifically the release and injunction provisions issues. The Altig Claimants do not appeal the Bankruptcy Court’s opinion on the release and injunction provisions raised in its December 21, 1999 Opinion. The Altig Claimants have not argued that the balance of the Bankruptcy Court’s December 21, 1999 Opinion modified its November 30, 1999 Confirmation Order. The Insurers notices of appeal from the December 21, 1999 Opinion regarding the release and injunction provisions were also filed beyond the 10 day appeal time period
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which expired on January 4, 2000. Because the briefs on appeal submitted by the parties address issues that have been raised by other parties who filed timely appeals, the Court will consider the briefs submitted as
amicus curiae
briefs.
VI.
APPEALABILITY OF THE DECEMBER 21,1999 OPINION
A.
Parties filing Appeals and Motions regarding the December 21, 1999 Opinion
The Shareholders, Dow Chemical and Corning, Inc., and the Proponents, the Debtor and the Tort Claimants’ Committee, filed separate appeals from the December 21, 1999 Opinion seeking review of the Bankruptcy Court’s release and injunction opinion. A Motion to Vacate the December 21, 1999 Opinion and a Motion to Withdraw the Reference were also filed by the Proponents relating to the injunction issue. The Shareholders filed a document before the Bankruptcy Court entitled “Notice of Shareholders of Failure to Satisfy Condition” which was stricken by the Bankruptcy Court. The Shareholders filed an appeal of the Bankruptcy Court’s Order striking the Notice. Certain insurance companies also filed an appeal from the December 21, 1999 Opinion. A Motion to Dismiss the appeals relating to the December 21, 1999 Opinion was filed by the United States of America (“United States”).
B.
United States’ Motion to Dismiss Appeal
1.
Background of the December 21, 1999 Opinion
The United States filed a Motion to Dismiss the Appeals relating to the December 21, 1999 Opinion of the Bankruptcy Court addressing the Release and Injunction provisions of the Joint Plan because the Notices of Appeals were filed more than ten days after the November 30, 1999 Confirmation Order. The United States, joined by several parties (the “Plan Opponents”), argue that any appeal from the November 30, 1999 Confirmation Order should have been filed within ten days from that date, as opposed to ten days from December 21, 1999, the date the Opinion was issued on the Release and Injunction provisions. The Proponents, Shareholders and the Settling Insurers argue that their Appeals are timely because the December 21, 1999 Opinion changed the November 30, 1999 Confirmation Order as to the release and injunction issues.
The Joint Plan provides that “All Persons who have held, hold or may hold Products Liability Claims, whether known or unknown, shall be deemed to have forever waived and released all such rights or claims against the Released Parties.” Joint Plan, § 8.3. The released parties include the “Shareholders” and the “Proponents”. The Joint Plan further provides that “all Persons who have held, hold, or may hold Released Claims, whether known or unknown ... shall be permanently enjoined” from pursuing those claims against the Released Parties. Joint Plan, § 8.4.
In response to the Amended Joint Plan, several claimants vehemently argued that the injunction provision violated the Bankruptcy Code. According to the Proponents and Shareholders, the crux of the debate centered around whether a release that applied to all claimants was legal. Even though there was disagreement over the validity of the injunction provisions, the Proponents argue that all parties involved agreed that the scope of the provision was to release the Shareholders and Proponents from all product liability claims, regardless of whether the claimants voted for or against the Joint Plan or did not vote at all. In support of this assertion, the Proponents and Shareholders cite excerpts from filings made by the Nevada objectors, the Australian complainants, and the Official Committee of Unsecured Creditors which reference the injunction provision as applying to “all” tort claimants and the resulting lack of options.
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The Proponents and Shareholders believe that the release and injunction sections of the Joint Plan make it clear that they are released from any and all products liability claims. This means that anyone with a claim relating to an implant or any of the other claims being released, will not be able to sue or continue suit against any of the released parties, including Dow Corning, Dow Chemical, Corning Inc. and the Settling Insurers.
The Bankruptcy Court’s Confirmation Order stated that “[t]he Plan, including its attached and incorporated separate agreements, compromises, settlements, and assumptions and rejections of executory contacts and unexpired leases, is confirmed.”
Order Confirming Amended Joint Plan of Reorganization as Modified,
p. 1. The Confirmation Order does not specifically address the release and injunction provisions at issue. The Findings of Fact and Conclusions of Law state the following:
21. The Settling Physicians, the Settling Insurers, Corning, Inc. and The Dow Chemical Company will all make important contributions to the reorganization as part of a confirmed Plan.
22. The release and injunction provisions with respect to the Settling Physicians, Settling Insurers, Corning, Inc. and The Dow Chemical Company are essential to reorganization pursuant to this Plan.
23. A large majority of the creditors impacted by the release and injunction provisions approved the Plan.
24. There is a close connection between the claims of the Settling Physicians, the Settling Insurers, Corning, Inc. and the Dow Chemical Company on the one hand and the claims against the Debtor on the other hand.
25. The Plan provides for the payment of all of the claims affected by the release and injunction provisions of the Plan.
November SO, 1999 Findings of Fact and Conclusions of Law Regarding Confirmation of the Joint Plan of Reorganization,
p. 5. The Conclusions of Law state:
D. The Plan complies with the applicable provisions of title 11 United States Code. 11 U.S.C. § 1129 (a)(1).
See
separate opinion to be issued later with respect to this issue.
Id.
The Proponents and Shareholders argue that the findings set forth in ¶¶ 21-25 are precisely the factors that courts have held may in certain circumstances warrant approval of plans of reorganization containing release and injunction provisions that bar claims against non-debtors by all claimants, regardless of how or whether they voted on confirmation.
See November SO, 1999 Findings of Fact,
¶¶ 21-25. The United States agrees with the Proponents and Shareholders in this regard and maintains that the November 30, 1999 Confirmation Order was in fact an approval of the reorganization plan. As a result of the November 30, 1999 Confirmation Order, a number of claimants who had voted against the Joint Plan, including the United States, promptly filed Notices of Appeal.
On December 21, 1999, the Bankruptcy Court issued an opinion which was described as “the last in a series of opinions serving to supplement and explain the findings and conclusions previously submitted.”
In re Dow Corning Corp. (Opinion on Best-Interests-of-Creditors Test),
244 B.R. at 726. Contained within this opinion was a discussion regarding the Joint Plan’s release and injunction provisions. The Bankruptcy Court opined that those provisions apply only to claimants who voted in favor of confirmation, but not to claimants who voted against the Joint Plan or who did not vote at all. In essence, the Bankruptcy Court reasoned that it lacked the power to release claims held by non-voters or objectors. The Bankruptcy Court also noted that since the release and injunctive provisions were only
*469
applicable to those claimants who voted in favor of the Plan, there was no need for an injunction. According to the Bankruptcy Court, the creditors that voted for the Plan agreed to relinquish their claims against the released parties, and as a result, the Proponents would not suffer irreparable harm.
Id.
at 745-46.
The Proponents and the Shareholders filed notices of appeal within (10) days of the December 21, 1999 Opinion asserting that the Opinion significantly altered the previous judgment entered by the court. The United States moved to dismiss the appeals, arguing that (1) the Proponents and Shareholders failed to appeal within ten days of the November 30 Confirmation Order, and (2) the December 21 Opinion is not independently appealable.
2.
Finality of the December 21, 1999 Opinion
This Court has jurisdiction to hear appeals “from final judgments, orders and decrees” entered by bankruptcy courts. 28 U.S.C. § 158 (a). The time limit to pursue an appeal in a bankruptcy case is more accelerated than that applicable to generic non-bankruptcy civil cases. Specifically, Rule 8002(a) of the Bankruptcy Rules states that “[t]he notice of appeal shall be filed with the clerk within 10 days of the date of the entry of the judgment, order or decree appealed from.”
The Proponents and Shareholders argue that they filed a notice of appeal from the December 21 opinion as well as from the November 30 Confirmation Order to the extent that it was amended or modified by the December 21 Opinion. It is undisputed that the Proponents failed to appeal within the required ten days of the November 30, 1999 Order, but did file a Notice of Appeal within the ten days after the December 21 Opinion was issued. The question is whether the December 21 Opinion satisfies the requirement for a final judgment as outlined in 28 U.S.C. § 158 (a). the Court finds the Opinion is a final order and this Court has jurisdiction to hear the Proponents and Shareholders’ appeal pursuant to Bankruptcy Rule 8002 and 28 U.S.C. § 158 (a).
The Supreme Court has promulgated a test for determining when parties should be allowed to appeal an order entered subsequent to a court’s final judgment. The Supreme Court wrote:
[T]he mere fact that a judgment previously entered has been reentered or revised in an immaterial way does not toll the time within which review must be sought. Only when the lower court changes matters of substance or resolves a genuine ambiguity, in a judgment previously rendered should the period within which an appeal must be taken or a petition for certiorari filed begin to run anew. The test is a practical one. The question is whether the lower court, in its second order, has disturbed or revised legal rights and obligations which, by its prior judgment, had been plainly and properly settled with finality.
Federal Trade Commission v. Minneapolis-Honeywell Regulator Co.,
344 U.S. 206 , 73 S.Ct. 245 , 97 L.Ed. 245 (1952). The Supreme Court also indicated that the question of whether the time for petitioning for appeal should be enlarged “cannot turn on the adjective which the court below chose to use in the caption of its second judgment.”
Id.
at 212 , 73 S.Ct. 245 .
This test was adopted by the Sixth Circuit in
Green v. Nevers,
196 F.3d 627 (6th Cir.1999) and
Cuyahoga Valley Railway Company v. Tracy,
6 F.3d 389 (6th Cir.1993). In
Green ,
a plaintiff attempted to appeal an order that was entered subsequent to a court’s final decree. The Sixth Circuit reasoned that the second order merely amended the first order by correcting “a minor technical error” and therefore did not toll the time for filing a notice of appeal.
Green,
196 F.3d at 631 . In accordance with the
Minneapolis-Honeywell
case, the Sixth Circuit concluded that be
*470
cause there were no substantive changes or resolution of genuine ambiguity, the second order did not restart the time for appeal.
Id.
Similarly in
Tracy,
the Sixth Circuit determined that the defendants’ attempt to appeal from a subsequent order which it contended modified certain aspects of the original order was untimely. The defendants argued that because the second order modified certain aspects of the court’s first order, every item in the first order was subject to appeal. The issue that the defendants sought for review was not altered or even mentioned in the second court order. The
Tracy
court held that “the relevant case law in no way suggests that once one issue has been modified, all of the issues from the original order are fair game for appeal.”
Tracy,
6 F.3d at 395. The district court’s later modification of the first order was completely unrelated to the issue the defendants disputed and therefore did not alter the state of repose.
Id.
The Sixth Circuit has also determined that “[A] decision is final for purposes of appeal if an appeal is the only method of obtaining review.”
United States v. Lee,
786 F.2d 951 (9th Cir.1986).
Here, the December 21 Opinion revised the November 30 Confirmation Order in a material way. The Bankruptcy Court specifically stated in its December 21, 1999 Opinion that Claimants who voted against the Joint Plan or who did not vote at all, are not deemed to have released the non-debtors and could still bring suit against the Proponents and the Shareholders. For the first time, the Bankruptcy Court articulated the scope and effect of the release and injunction on all of the parties. The November 30 Confirmation Order did not elaborate on or explain interpret these provisions. The Bankruptcy Court simply stated that “the Plan, including its attached and incorporated separate agreements, compromises, settlements, and assumptions and rejections of executory contracts and unexpired leases [was] confirmed.”
November 30, 1999 Confirmation Order,
p. 1. The Findings of Fact and Conclusions of Law issued on the same date, reference the provisions, but fail to detail the ramifications they have on the parties. The Findings of Fact, in ¶¶ 21-25, address factors that courts have articulated to support the imposition of releases and injunctions. The Conclusions of Law do not address the injunction and release issues but merely state that “[t]he Plan complies with the applicable provisions of title 11 United States Code. 11 U.S.C. § 1129 (a)(1).
See
separate opinion to be issued later with respect to this issue.”
November 30, 1999 Findings of Fact,
¶ D. Nowhere in the Bankruptcy Court’s November 30, 1999 Findings of Fact and Conclusions of Law nor the November 30, 1999 Confirmation Order does it expressly state that the release and injunction provisions only apply to those who approved the Plan.
The December 21 Opinion revised the scope of the injunction/release provisions and made these provisions applicable only to those parties who voted in favor of the confirmation plan. If this Court accepts the United States’ argument and concludes that the November 30 Confirmation Order was the Bankruptcy Court’s final decree, then the entire plan, as written, was confirmed on that date. The release and injunction provisions would then apply to
“all
Persons who have held, hold, or may hold Products Liability Claims whether known or unknown.” Joint Plan, § 8.3 (italics added). Since, this was clearly not the Bankruptcy Court’s interpretation when the November 30 Confirmation Order was entered, the subsequent December 21 Opinion changed the legal rights and obligations of the parties, as written under the Joint Plan.
The Proponents seek review of the subject matter that was substantially altered by the December 21 Opinion. As noted in
Tracy,
an appeal may be barred if the parties seek review of an entire order simply because one provision has been altered by a subsequent judgment. In the instant
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case however, the Proponents seek review of the only significant change in the December 21 Opinion, specifically, Section IV of the Opinion — the applicability and scope of the release/injunction provisions.
If this Court denies the Proponents’ review of their appeal, there will be no alternative means for them to seek review of the December 21 Opinion. Based on
Lee ,
the opinion qualifies the as a final decision for purposes of appeal. In accordance with
Minneapolis-Honeytuell
and
Lee ,
the December 21 Opinion is appeal-able. The December 21 Opinion materially altered the November 30 Confirmation Order, and the Proponents have no other way to assert their objections except through appeal. Since the Bankruptcy Court did not specifically address the injunction and release issues either in its Findings of Fact and Conclusions of Law or in the November 30 Confirmation Order, the Proponents reasonably believed that the reorganization plan had been confirmed as written, and all issues had been settled with finality. The Appellants who objected to the Plan also reasonably believed that the injunction and release provisions had been confirmed by the Bankruptcy court’s November 30 Confirmation Order as evidenced by their own timely appeals of the confirmation of those provisions.
As indicated above, this Court has jurisdiction to hear appeals “from final judgments, orders, and decrees” entered by bankruptcy courts. 28 U.S.C. § 158 (a). The Sixth Circuit has adopted the Supreme Court’s definition of a final order as one that “ends the litigation on the merits and leaves nothing for the court to do but execute the judgment.”
Whittington v. Milby,
928 F.2d 188, 191 (6th Cir.1991) (quoting
Catlin v. United States,
324 U.S. 229, 233 , 65 S.Ct. 631 , 89 L.Ed. 911 (1945)). This Circuit has also emphasized that the requirement of finality is to be given a practical rather than a technical construction.
Id.
(citing
Eisen v. Carlisle & Jac-quelin,
417 U.S. 156, 171 , 94 S.Ct. 2140 , 40 L.Ed.2d 732 (1974)).
In cases of marginal finality, the Sixth Circuit has adopted what has become known as the
Gillespie
doctrine.
Vause v. Capital Poly Bag, Inc.,
886 F.2d 794, 797 (1989). In certain close cases where finality cannot be conclusively resolved, the court has determined that the “danger of denying justice by delay outweighs the inconvenience and costs of piecemeal review, particularly when the questions on appeal are fundamental to the further outcome of the case.”
Id.
(quoting
Gillespie v. United States Steel Corp.,
379 U.S. 148 , 85 S.Ct. 308 , 13 L.Ed.2d 199 (1964)). The
Gillespie
doctrine, therefore, “permits the courts of appeals to decide the merits in cases of marginal finality where the course of litigation would be impeded, rather than advanced, by dismissing the appeal.”
Id.
The Proponents contend that the Bankruptcy Court’s statement on January 10, 2000 that the December 21 Opinion “did not amend, modify or otherwise change the order confirming the plan” does not establish that the December 21 Opinion did not modify the November 30 Confirmation Order. Nor should it matter that the December 21 ruling is labeled an “opinion” instead of an “order.” In support of this contention, the Proponents quote the Ninth Circuit which has stated that:
[f]or purposes of determining appealability of an order, “the trial judge’s characterization of his own action cannot control the classification of the action.” The court should instead focus on the effect of the ruling rather than the label placed on it.
Lee,
786 F.2d at 955 (quoting
United States v. Scott,
437 U.S. 82, 96 , 98 S.Ct. 2187 , 57 L.Ed.2d 65 (1978)) (other citations omitted). The Proponents also cite
American Motors Corp. v. FTC,
601 F.2d 1329 , 1331 n. 2 (6th Cir.1979) and
United States v. Battisti,
486 F.2d 961, 967 (6th Cir.1973), which stand for the proposition that appealability of an order depends on its
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substantial effect versus the label attached to it.
The argument asserted by the Proponents has been upheld in the Seventh and Third Circuits. In
Charles v. Daley,
799 F.2d 343 (7th Cir.1986), a district court entered an award of attorney fees in favor of the plaintiff on October 1, 1984. The order awarded fees but did not stipulate which defendants would be responsible for payment. The accompanying opinion said that the “defendants” would pay, but it referred to three intervenor-defendants as intervenors. One reading of the order made the intervening defendants jointly and severally liable for the $200,000 attorney fee award. Another reading of the order did not make them liable at all. The intervenors requested clarification and modification of the order and filed a timely motion to suspend the finality of the judgment until the court ruled on their motion. On April 22, 1985, the district court denied their motion for clarification and modification and entered another order indicating that the plaintiffs fees and costs would be borne equally by the defendants. The district court’s April 22 order both denied the intervenors motion and amended the original judgment entered on October 1, 1984.
The
Daley
court applied the holding of
Minneapolis-Honeywell
and concluded that there was a genuine ambiguity in the court’s original order dated October 1, 1984. The subsequent April 22 order not only dispelled the ambiguity but also made substantive changes. By dividing liability among the groups of defendants, and making the intervenors jointly and severally liable for the plaintiffs attorney fees and costs, the April 22 order became a new order, affording the aggrieved parties time to seek alteration or appeal.
Daley,
799 F.2d at 348 . The
Daley
court noted that “the sort of alteration that restarts all periods of time is one that changes matters of substance, or resolves a genuine ambiguity, in a judgment previously rendered.”
Id.
(quoting
Minneapolis-Honeywell,
344 U.S. at 211 , 73 S.Ct. 245 ). The Third Circuit has also determined that “an order substantively changing a judgment, constitutes a new judgment with its own time for appeal at least where the change is the subject matter to be reviewed.”
Keith v. Truck Stops Corporation of America,
909 F.2d 743, 746 (3rd Cir.1990).
Applying the rationale of the Ninth, Seventh and Third Circuits to the case at bar, the December 21 Opinion is appealable. A trial court judge’s characterization of the rulings he/she enters is of no moment. It is the effect of these rulings which determines their appealability. The December 21 Opinion clarified and substantively changed the applicability of the release and injunction provisions.
Applying the
Whittington
holding to the case at bar, it is practical to interpret the December 21 Opinion as the Bankruptcy Court’s final order on the release and injunction issues. As indicated in
Whittington ,
an order is not final unless all issues have been addressed and resolved. It is clear that this requirement was not satisfied until the Bankruptcy Court issued the December 21 Opinion on the release and injunction issues. Since all parties placed significant importance on the release and injunction provisions, it is impractical to interpret the November 30 Order as final when key components to the reorganization plan were changed by the December 21 Opinion.
The
Gillespie
doctrine directs that any issue that is fundamental to the future outcome of a case should meet the finality requirement and should be appealable. There is no question that this is a fundamental issue that has the potential of seriously affecting the Proponents and/or Shareholders in the future. Applying the
Gillespie
doctrine to the facts of the instant case it is clear that the requirement of finality has been met, and the Proponents and Shareholders will be allowed to appeal the December 21 Opinion.
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3.
Notice/Due Process
The Proponents and Shareholders contend that it would violate due process if they were barred from appealing the December 21 ruling when they filed notices of appeal within 10 days of the Bankruptcy Court’s announcement of notification. According to the Proponents, “[a]n elementary and fundamental requirement of due process in any proceeding which is to be accorded finality is notice reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections.”
Mullane v. Central Hanover Bank & Trust Co.,
339 U.S. 306, 314 , 70 S.Ct. 652 , 94 L.Ed. 865 (1950). The notice must also be of such nature “to reasonably convey the required information and afford a reasonable time for those interested to make their appearance.”
Id.
Applying the
Mullane
holding, the Sixth Circuit has also determined that the failure to give adequate notice is violative of procedural due process.
Verba v. Ohio Casualty Insurance Co.,
851 F.2d 811, 815 (6th Cir.1988).
When the Bankruptcy Court issued its Findings of Fact and Conclusions of Law on November 30, the court indicated that several of its findings would be more fully explained in a subsequent separate opinion. There was no indication however, that the language confirming the release and injunction provisions would be interpreted other than as intended by the Proponents. The parties reasonably concluded that the Bankruptcy Court had adopted these provisions as written in the Joint Plan. This is evidenced by the actions of the parties following the issuance of the November 30 Confirmation Order. The Nevada Claimants specifically stated that the basis of their appeal centered around the permanent injunction provision. The United States also questioned the injunction provision and whether the bankruptcy court erred in confirming a Plan which releases entities from the claims of all parties and enjoins all parties from all actions against the Released Parties for future claims. The Proponents, along with the Plan Opponents, thought that the release and injunction provisions, as written in the Joint Plan, required “all” claimants to release the Debtor, the Shareholders and the Settling Insurers. Not until the issuance of the December 21 Opinion did the parties become aware of the Bankruptcy Court’s reasoning. The Bankruptcy Court’s interpretation of the release and injunction provisions altered the plain language of the reorganization plan from
“all
persons who have held, hold, or may hold Released Claims, whether known or unknown” to make the provisions applicable only to “those persons who accepted the plan.”
Best-Interests Opinion,
244 B.R. at 745.
Upon review of the November 30 Confirmation Order and Findings of Fact and Conclusions of Law, there is no indication that the court intended to interpret the release and injunction provision as the Bankruptcy Court finally did in its December 21 Opinion. The Proponents had no formal notice of the Bankruptcy Court’s reasoning or intentions with regard to the release/injunction provisions. Once the December 21 Opinion was issued, putting the Proponents on notice of the court’s final holding, a timely appeal was filed. As noted in
Mullane,
because the Proponents were not given notice of the applicability of the November 30 Confirmation Order, it would be a violation of due process to deny them an opportunity to present their objections to the December 21 Opinion.
4.
Conclusion
The December 21 Opinion qualifies as a final judgment which gives this Court jurisdiction to hear the Proponents’ for appeal. The November 30 Confirmation Order stated that the amended reorganization plan had been confirmed in its entirety. From this statement, there is no indication that the Bankruptcy Court planned by its subsequent opinions to in
*474
terpret any of the Plan’s provisions differently from the plain language of the Plan. As a result, the Proponents were not given notice of their need to appeal until after the Bankruptcy Court issued the December 21 Opinion which substantially altered the applicability of the release and injunction provisions. It would be violative of procedural due process to deny the Proponents the only opportunity they have in which to address their objections to the modifications contained within the December 21 Opinion. The December 21 Opinion falls within the definition of a final order. It was a clear articulation by the Bankruptcy Court of its holding regarding the release and injunction provisions.
C.
Proponents’ Motion to Withdraw the Reference
Alternatively, the Proponents have filed a Motion to Withdraw the Reference should the Court decide not to consider their appeal on the merits. 28 U.S.C. § 157 (d) provides that “[t]he district court may withdraw, in whole or in part, any case or proceeding referred under this section, on its own motion or on timely motion of any party, for cause shown.” “Cause” is not defined. In order to determine “cause,”
The district court should consider the goals of promoting uniformity in bankruptcy administration, reducing forum shopping and confusion, fostering the economical use of the debtors’ and creditors’ resources, and expediting the bankruptcy process.
Holland America Ins. Co. v. Succession of Roy,
777 F.2d 992, 999 (5th Cir.1985). Although not explicitly required for withdrawal
sua sponte,
it has been held by some courts that after a core proceeding is finally disposed of by the bankruptcy court, a district court must proceed under its appellate jurisdiction as opposed to utilizing its original jurisdiction by withdrawing the reference.
In re Pruitt,
910 F.2d 1160, 1168 (3rd Cir.1990). Once core proceedings become final, withdrawing the reference would be without cause.
Id.; Carlton v. Baww, Inc.,
751 F.2d 781, 788, n. 10 (5th Cir.1985). The Seventh Circuit has stated:
The timing of the court’s withdrawal of the reference here, even if not improper, seems to be in conflict with the statutory objectives of utilizing the expertise of bankruptcy judges, reducing forum shopping and preserving the appellate processes provided by the Bankruptcy Act.
In the Matter of Powelson,
878 F.2d 976, 983 (7th Cir.1989). Although the statute does not expressly forbid the withdrawal of reference after a final order has been entered, such withdrawal appears to violate the intent of Congress as reflected in the statutory scheme taken as a whole.
Id.
at 983-84 . Congress has established a structure within the bankruptcy court system which allows for the district courts to supervise the bankruptcy courts in two different capacities: first, withdrawal of the reference and the reinstatement of the district court’s original jurisdiction under 28 U.S.C. § 158 (d) and second, through the appellate process in 28 U.S.C. § 157 (a). “[Allowing the withdrawal of the reference to occur at any time, and especially after the appeal process has begun, would seriously disturb the statutory objective of ‘preserving the appellate processes provided by the Bankruptcy Act.’ ”
In re Pruitt,
910 F.2d at 1169 (concurring opinion),
citing Powelson,
878 F.2d at 983 . Although the precise issue has not been addressed by the Sixth Circuit, the Sixth Circuit has stated that short circuiting the orderly procedure for the administration of bankruptcy stays without recognizing the legal effect of the bankruptcy stay to a case before the trial court is not favored.
NLT Computer Servs. Corp. v. Capital Computer Sys., Inc.,
755 F.2d 1253 , 1258 (6th Cir.1985).
A final confirmation order has been entered in this matter. The Court will not on this occasion withdraw the reference at
*475
this late stage based on the statutory scheme as a whole. The Court will not exercise both its original and appellate jurisdiction to review the issues raised in the same order.
VII.
RELEASE AND INJUNCTION PROVISIONS
A.
Sections 8.3 and 8.4 of the Joint Plan
Section 1129(a) sets forth 13 requirements for confirmation of the plan. One of those requirements is found in 11 U.S.C. § 1129 (a)(1) which provides that a plan cannot be confirmed unless it “complies with the applicable provisions of [the Bankruptcy Code].” The Bankruptcy Court has the authority to approve reorganization plans, including any provision “not inconsistent with the applicable provisions of [the Code].” 11 U.S.C. § 1123 (b)(6).
Section 8.3 of the Plan (the “release provision”) provides that personal-injury claims against various parties are deemed waived and released upon the effective date of the confirmation of the Plan. Section 8.4 (the “injunction provision”) provides that holders of the claims are enjoined from commencing or continuing any action seeking to enforce their claims against the Released Parties, including the Debtor-Affiliated Parties (the Debtor, the Reorganized Debtor, the Joint Ventures and Subsidiaries, and their respective Representatives), the Shareholder-Affiliated Parties (the Shareholders and their past and present Affiliates and their Representatives), the Settling Insurers, the Settling Physicians, and the Settling Health Care Providers. Amended Joint Plan, §§ 8.3, 8.4.
In its opinion issued on December 21, 1999, the Bankruptcy Court, explained its Findings of Fact as to the release and injunction provisions. The Bankruptcy Court concluded that the release and injunction provisions are consistent with the Bankruptcy Code.
Best-Interests Opinion,
244 B.R. at 740. However, the Bankruptcy Court interpreted the provisions to apply only to those persons who voted in favor of the Plan based on non-bankruptcy law, in particular the
Grupo
Mexicano
5
case. The Bankruptcy Court found that §§ 8.3 and 8.4 are permissible and that the Plan can be confirmed by applying §§ 8.3 and 8.4 only to those creditors who voted to accept the Plan. The Bankruptcy Court concluded that §§ 8.3 and 8.4 are appropriate provisions and not inconsistent with the Code when applied in this way.
Best-Interests Opinion,
244 B.R. at 745. The Bankruptcy Court noted that if the terms of the Plan were plain and construed to include “all persons” holding claims of the type described in the provisions, then the court would have no choice but to deny confirmation of the Plan. 244 B.R. at 745.
Prior to the issuance of the December 21, 1999 Opinion appeals were filed from the November 30, 1999 Confirmation Order on the release and injunction issues by certain personal injury claimants arguing that the release and injunction provisions releasing, in particular, the Shareholders, are improper. After the Bankruptcy Court’s issuance of its December 21, 1999 Opinion, the Proponents and the Shareholders filed appeals on the release and injunction portion of that Opinion claiming that the Bankruptcy Court’s interpretation of the release and injunction provisions as binding only on those who voted to accept the Plan.
There is no dispute that the Debtor is discharged and, essentially released, from the various claims against it. The Court will address below the state of the law on the release and injunction issues, as it applies to non-debtors, whether the Bankruptcy Court erred in its interpretation of the release and injunction provisions, and each party’s arguments as to whether the
*476
release and injunction provisions are proper.
B.
Jurisdiction!Authority
The release and injunction provisions of the Plan are construed a non-debtor discharge. The starting place for analysis of non-debtor discharge is whether the bankruptcy court has jurisdiction under 28 U.S.C. § 1334 (b).
Matter of Zale Corp. (Feld v. Zale Corp.),
62 F.3d 746, 751 (5th Cir.1995). Generally, bankruptcy jurisdiction is not conferred for the convenience of those not in bankruptcy.
In re Pacor, Inc. v. Higgins,
743 F.2d 984, 996 (3rd Cir.1984),
rev’d on other grounds, Things Remembered, Inc. v. Petrarca,
516 U.S. 124, 134-35 , 116 S.Ct. 494 , 133 L.Ed.2d 461 (1995). Unless the parties involved are the debtor and the creditors, or the bankruptcy court has “related to” jurisdiction over certain parties, the bankruptcy court has no jurisdiction to enter orders pertaining to parties who are not related to the bankruptcy action.
The Released Parties under §§ 8.3 and 8.4 of the Plan include, the Settling Physicians, the Settling Health Care Providers, the Debtor-Affiliated Parties, the Shareholder-Affiliated Parties, and the Settling Insurers. Amended Joint Plan, § 8.3. In this case, the Sixth Circuit has ruled that § 1334(b) “related to” jurisdiction exists over the actions pending against the Shareholders, Dow Chemical and Corning, Inc.
In re Dow Corning Corp. (Lindsey I),
86 F.3d 482, 494 (6th Cir.1996). The Sixth Circuit has also ruled that § 1334(b) jurisdiction covers the joint insurance policies between the Debtor and the Shareholders.
Id.
at 495. This Court also has § 1334(b) jurisdiction over the Settling Physicians and the Settling Health Care Providers because they have claims against the Debtor for indemnification and/or contribution and some physicians have direct tort claims against the Debtor arising from the Debtor’s misrepresentations in the marketing, sale, and provision of breast implants and other products for use in a Physician Claimant’s medical practice.
The next consideration is whether the bankruptcy court has the authority to enter the particular kind of relief sought— a non-debtor discharge.
American Hardwoods, Inc. v. Deutsche Credit Corp.,
885 F.2d 621, 624 (9th Cir.1989). While a bankruptcy court may have subject matter jurisdiction to hear a dispute between non-debtors, it may lack the authority to enter a particular type of relief.
In re Arrowmill Development Corp.,
211 B.R. 497, 503 (Bankr.D.N.J.1997).
C.
Dischargelll U.S.C. § 524(e)
In bankruptcy, a discharge is an involuntary release by operation of law of asserted and non-asserted claims by a creditor against an entity who has filed a petition under the bankruptcy code and who has abided by its rules.
In re Arrowmill,
211 B.R. at 504. Upon confirmation of a plan, a Chapter 11 debtor receives a discharge of its debts which arose before confirmation. 11 U.S.C. § 1141 (d)(1). 11 U.S.C. § 524 (e) limits the scope of the discharge. A “discharge of a debt of the debtor does not affect the liability of any other entity on, or the property of any other entity, for such debt.” 11 U.S.C. § 524 (e). The circuit courts are divided over the issue of non-debtor discharge— whether a party, other than a debtor, may receive a discharge of a debt in the context of the debtor’s bankruptcy action. Three lines of cases have been identified emerging from the various decisions.
In re Arrowmill,
211 B.R. at 504.
The first line of cases holds that the bankruptcy court has the authority to confirm reorganization plans which discharge non-debtors even if there are objecting creditors.
Monarch Life Ins. Co. v. Ropes & Gray (In re Monarch Capital Corp.),
173 B.R. 31 (D.Mass.1994),
aff'd,
65 F.3d 973, 980 (1st Cir.1995);
MacArthur Co. v. Johns-Manville Corp. (In re Johns-Manville Corp.),
837 F.2d 89, 93 (2d Cir.1988);
Securities and Exchange Comm’n v. Drex-
*477
el Burnham Lambert Group, Inc. (In re Drexel Burnham Lambert Group, Inc.),
960 F.2d 285, 293 (2nd Cir.1992);
Menard-Sanford v. Mabey (In re A.H. Robins Co., Inc.),
880 F.2d 694 (4th Cir.1989);
Republic Supply Co. v. Shoaf,
815 F.2d 1046, 1053 (5th Cir.1987); and
Matter of Munford, Inc. (Munford v. Munford, Inc.),
97 F.3d 449, 454 (11th Cir.1996).
The second line of cases holds that the bankruptcy court does not have the authority to discharge or release a non-debtor.
In re Zale Corp.,
62 F.3d at 756 (5th Cir.);
Hall v. Nat’l Gypsum Co.,
105 F.3d 225, 229 (5th Cir.1997);
Zerand-Bernal Group, Inc. v. Cox,
23 F.3d 159, 163 (7th Cir.1994);
In re American Hardwoods,
885 F.2d at 626 (9th Cir.);
Resorts Int’l, Inc. v. Lowenschuss (In re Lowenschuss),
67 F.3d 1394, 1402 (9th Cir.1995); and
In re Western Real Estate Fund, Inc. (Landsing Diversified Properties-II v. First Nat’l Bank and Trust Co. of Tulsa),
922 F.2d 592, 602 (10th Cir.1990),
modified sub nom., Abel v. West,
932 F.2d 898 (10th Cir.1991).
The third line of cases holds that bankruptcy courts may discharge or release non-debtors from their debts only if the affected creditors consent.
In re AOV Indus., Inc.,
792 F.2d 1140, 1145-46 (D.C.Cir.1986); and
Matter of Specialty Equip. Co., Inc.,
3 F.3d 1043, 1047 (7th Cir.1993) (disavowing its prior case,
Union Carbide Corp. v. Newboles,
686 F.2d 593 (7th Cir.1982), which prohibited non-debtor releases.).
The Third Circuit recently addressed the validity of non-debtor releases although it declined to establish a rule regarding the conditions under which non-debtor releases and permanent injunctions are appropriate or permissible.
In re Continental Airlines (Gillman v. Continental Airlines),
203 F.3d 203, 214 (3rd Cir.2000). The Third Circuit ruled that under any of the tests recognized by various courts, the non-debtor release provision before that court could not pass muster.
Id.
The Third Circuit recognized the following factors required of non-consensual releases: 1) fairness; 2) necessity to the reorganization; and 3) specific factual findings to support the conclusions.
Id.
Although the Third Circuit noted that several of the bankruptcy courts in its circuit have stated that non-debtor releases are permissible only if consensual, at least with respect to direct (as opposed to derivative) claims, the Third Circuit noted that none of these cases involved the mass litigation found in
Robins, Manville, or Drexel. Id.,
n. 11.
The Sixth Circuit has not ruled upon the issue of whether a bankruptcy court has the authority to grant a post-confirmation permanent injunction for the benefit of non-debtor third parties although it has discussed preliminary injunction issues relating to bankruptcies.
In re Richard Potasky Jeweler, Inc. (Greenblatt v. Richard Potasky Jeweler, Inc.),
222 B.R. 816 , 824 n. 14 (S.D.Ohio 1998).
The underlying reason for the differing views among the circuits stems from the interpretation of §§ 524(e) and 105(a). Some courts have ruled that § 524(e) has a preclusive effect over the bankruptcy court’s broad equitable powers found in § 105(a). Section 524(e) states that the discharge of the debtor’s debt does not affect the liability of any other entity for such debt. On its face, § 524(e) does not set forth a per se rule prohibiting permanent injunctions as to non-debtors.
In re Potasky Jeweler,
222 B.R. at 824 . However, some courts have ruled that § 524(e) prohibits permanent injunctions as to non-debtors, referencing § 524(e)’s predecessors, §§16 and 22(b) of the Bankruptcy Act of 1898, which included mandatory language prohibiting the release of certain parties.
In re American Hardwoods, Inc.,
885 F.2d at 625 . The current language found in § 524(e) contains no explicit reference to third party non-debtors.
In re Potasky Jeweler,
222 B.R. at 825 . The conclusion by some courts is that the interplay between § 105 and § 524(e) barring third party injunctions is
*478
unwarranted, based on the plain language of both statutes.
Id.
When interpreting the provisions of the Code, a court should be guided by the plain meaning of the statute.
See Pioneer Inv. Serv. Co. v. Brunswick Assoc. Ltd. Partnership,
507 U.S. 380, 387-89 , 113 S.Ct. 1489 , 123 L.Ed.2d 74 (1993). When the plain meaning of a statute is clear, the court’s inquiry is at an end.
United States v. Ron Pair Enter., Inc.,
489 U.S. 235, 240-42 , 109 S.Ct. 1026 , 103 L.Ed.2d 290 (1989). A court should interpret the Code in a manner that avoids a conflict between its various sections.
Id.
at 245-47 , 109 S.Ct. 1026 . Based on the current language of § 524(e), since it does not expressly prohibit third-party injunctions and given that Congress decided to exclude the mandatory language found in the predecessor of § 524(e) which expressly prohibited the release of certain parties, § 524(e) is not a source of authority prohibiting third-party injunctions.
D.
Equitable Power 111 U.S.C. § 105 (a)
The bankruptcy court’s equitable powers are derived from 11 U.S.C. § 105 (a) which provides, “[t]he court may issue any order, process, or judgment that is necessary or appropriate to carry out the provisions of this title.” The plain meaning of § 105(a) authorizes the bankruptcy court to enter only orders that are necessary to carry out the other provisions of the Code.
Wasserman v. Immormino (In re Granger Garage, Inc.),
921 F.2d 74, 77 (6th Cir.1990). “Whatever equitable powers remain in the bankruptcy courts must and can only be exercised within the confines of the Bankruptcy Code.”
Norwest Bank Worthington v. Ahlers,
485 U.S. 197, 206 , 108 S.Ct. 963 , 99 L.Ed.2d 169 (1988). Section 105, standing alone, cannot serve as a source of authority for granting a permanent injunction.
In re Potasky,
222 B.R. at 825 . “In the context of chapter 11 proceedings, the key to granting a permanent injunction ‘has been whether the injunction requested was necessary or appropriate to carry out the discharge provisions of [§ 1141].’ ”
Id., citing
2 Collier on Bankruptcy ¶ 105.03[2] [b] [ii], at 105-43 (15th ed. rev.1996) (internal quotations omitted).
Section 1141 only allows the discharge of property belonging to the debt- or’s estate in a plan of reorganization, “after confirmation of a plan, the property dealt with by the plan is free and clear of all claims and interests of creditors.... ” 11 U.S.C. § 1141 (a). Section 1141 is a source of authority for a permanent injunction pursuant to § 105(a), if the injunction has a direct and immediate connection to the property contained in or the administration of the debtor’s plan of reorganization.
In re Potasky,
222 B.R. at 826 ;
Zale Corp.,
62 F.3d at 760-61 . “To the extent that property is within the bankruptcy court’s jurisdiction, section 105 permanent injunctions would seem to [be] ‘necessary and appropriate’ to ensure the effectiveness of the discharge of section 1141.”
In re Potasky,
222 B.R. at 826 ,
citing
2 Collier on Bankruptcy § 105.03[2][b][ii][A] at 105-45 n. 84 (15th ed. rev.1996).
Section 1123(b)(3) is another source of authority for a bankruptcy court to exercise the equitable powers found in § 105(a).
In re Potasky,
222 B.R. at 826, n. 16 . Section 1123(b)(3) states that a plan of reorganization may provide for “the settlement or adjustment of any claim or interest belonging to the debtor or to the estate.” 11 U.S.C. § 1123 (b)(3). An injunction must promote what is “necessary and appropriate” to “carry out the provisions of section 1123(b)(3).
In re Potasky,
222 B.R. at 826, n. 16 ,
citing
2 Collier on Bankruptcy ¶ 105.03[2][b][ii][C], at 105-46 n. 90 (15th ed. rev.1996).
A third source of authority for a bankruptcy court to exercise equitable power is found in 11 U.S.C. § 1123 (b)(6) which allows a plan to “include any other appropriate provision not inconsistent with the applicable provisions of this title.”
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Section 105(a), along with § 1123(b)(6) provide the bankruptcy courts with broad authority to approve plans of reorganization that include provisions affecting creditors’ rights to recover against non-debtors, if the provisions are necessary to carry out the plan.
Energy Resources,
495 U.S. at 549, 110 S.Ct. 2139 . The Supreme Court also noted that the bankruptcy court had authority under § 1129(a)(11) to assure itself that the reorganization would succeed.
Id.
E.
Unusual Circumstances Test
The Third Circuit noted in
In re Continental Airlines,
that there are cases which involve mass litigation as in
Robins, Man-mile, or Drexel
in which injunctions have been ordered by the court in the bankruptcy context. These cases are characterized as “unusual circumstances cases.”
In re Potasky,
222 B.R. at 826 . The district court in
In re Potasky
noted:
Those courts holding that under ‘unusual circumstances’ a bankruptcy court may grant a permanent injunction to relieve third party non-debtors from liability are not at odds with this principle. In the cases adopting the unusual circumstances test, the courts have noted that the following circumstances justified the granting of a permanent injunction:
(1) That the suit against the non-debtor was, in essence, a suit against the debtor or will deplete assets of the estate;
(2) The non-debtor contributed substantial assets to-the debtor’s estate as part of the debtor’s plan of reorganization; and
(3) The injunction is essential to reorganization. Without the injunction the entire reorganization plan would unravel.
Id.
Other nonessential factors which show that an injunction against non-debtors provided for by a plan is fair, include: 1) that a substantial majority of the creditors agreed to the injunction, specifically, the impacted class of creditors; 2) the plan for reorganization provided for full payment of the creditor’s claims; and 3) the injunction affected only a small percentage of the claimants.
Id.,
n. 18. The Third Circuit noted the following factors, “[t]he hallmarks of permissible non-consensual releases-fairness, necessity to the reorganization, and specific findings to support these conclusions
...” In re Continental,
203 F.3d at 214 .
As noted by the district court in
In re Potasky,
In those cases where the courts found that unusual circumstances were present, the injunctions served either to marshal assets of the debtor’s estate or to channel the claims of creditors to assets of that estate. The existence of these assets, however, depended upon the action of a third party non-debtor. By permanently enjoining suits against these third party non-debtors, the courts created a legal environment that enabled the non-debtor to take the necessary steps which would lead to the creation of assets for the debtor’s estate.
222 B.R. at 826-27 . Section 524(e) did not preclude those courts from granting an injunction, nor did the granting of the injunction fall outside of the discharge provisions of § 1141 because the courts were dealing with the property of the debtor’s estate.
Id.
F.
Bankruptcy Court’s December 21, 1999 Opinion
The Bankruptcy Court expressly found that “neither § 524(e) nor § 524(g) precludes a court from granting non-debtor discharges.”
Best-Interests Opinion,
244 B.R. at 740. The Bankruptcy Court concluded that “§§ 8.3 and 8.4 are not inconsistent with the Code even if they apply to creditors who did not accept the Plan.”
Id.
However, the Bankruptcy Court found that based on other “non-bankruptcy law,” the release and injunction provisions are inappropriate as to non-accepting creditors.
Id.
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The Court agrees with the Bankruptcy-Court that the release and injunction provisions are not inconsistent with the Code, even if they apply to creditors who did not accept the Plan. Based on the discussion above, § 524(e) does not limit the Bankruptcy Court’s equitable powers under § 105(a) to issue permanent injunctions to non-accepting creditors. 11 U.S.C. §§ 1141 (a), 1123(b)(3), 1123(b)(6) and 1129(a)(11) are sources of authority from which the Bankruptcy Court can exercise its equitable powers under § 105(a) to issue permanent injunctions. Based on the above discussion, there is sufficient authority in the Code to justify the court’s issuance of an injunction. The Bankruptcy Court went beyond the Bankruptcy Code to find that it had no authority to issue an injunction against those who did not accept the Plan. The Bankruptcy Court cites
Grupo Mexicano de Desarrollo v. Alliance Bond Fund, Inc.,
527 U.S. 308 , 119 S.Ct. 1961 , 144 L.Ed.2d 319 (1999), to support its conclusion that based on non-bankruptcy law, the release provision could not apply to those creditors who did not vote in favor of the Plan. A preliminary injunction was issued by the district court in
Grupo Mexicano
enjoining the dissipation or transfer of the defendant’s assets pending adjudication of the plaintiffs claim for the amount on the notes at issue. The Supreme Court found that the injunction was improper based on the “well-established general rule that a judgment establishing the debt was necessary before a court of equity would interfere with the debtor’s use of his property.”
Id.
at 321 , 119 S.Ct. 1961 . The Supreme Court in its decision found that a district court did not have the authority to issue a preliminary injunction which affected a debtor’s property without a judgment establishing the debt, outside of a bankruptcy action.
Id.
The Supreme Court found that equity “is confined within the broad boundaries of traditional equitable relief,” but that equity would not permit “a type of relief that has never been available before.”
Id.
at 322 , 119 S.Ct. 1961 . Because no judgment had been entered against the defendant to establish the debt, the district court’s issuance of the preliminary injunction enjoining defendant from transferring certain assets was beyond its equitable authority.
The Supreme Court noted that in addition to general equitable powers under the Judiciary Act of 1789, a district court had injunctive authority under certain statutes — the statute authorizing issuance of tax injunctions in the
Grupo Mexicano
case.
Id.
at 326 , 119 S.Ct. 1961 . The Bankruptcy Court in this case, as noted above, had various statutory authorities to issue a permanent injunction under the Bankruptcy Code. This Court is cognizant that the Supreme Court has stated that even if consistent with the Code, a bankruptcy court order might be inappropriate if it conflicted with another law that should have been taken into consideration in the exercise of the court’s discretion.
Energy Resources,
495 U.S. at 550 , 110 S.Ct. 2139 . In
Energy Resources ,
the Supreme Court discussed a possible conflicting IRS statute, finding that the statute “plainly does not require us to hold that the orders at issue here, otherwise wholly consistent with a bankruptcy court’s authority under the Bankruptcy Code, were nonetheless improvident.”
Id.
at 551, 110 S.Ct. 2139 . The Supreme Court found that the bankruptcy court did not transgress any limitation on its broad power under the Code.
Id.
Here, other than the United States, no party has identified a possible conflicting statute outside the Bankruptcy Code which may limit the Bankruptcy Court’s powers under the Code.
The Bankruptcy Court’s conclusion that it has no authority to issue a non-consensual permanent injunction of non-debtor parties is reversed. There is sufficient statutory authority under the Bankruptcy Code to issue a permanent injunction in favor of non-debtor parties and the
Grupo Americano
case does not prohibit the Bankruptcy Court from issuing such an injunction. As noted above, in addition to § 105, courts have recognized §§ 1141,
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1123(b)(3), 1123(b)(6) and 1129(a)(11) as statutory authorities for the Bankruptcy Court to issue injunctions in favor of non-debtor parties based on non-consensual releases.
The Bankruptcy Court’s findings of fact support a finding in favor of an injunction and are not clearly erroneous The Bankruptcy Court found that: 1) the Settling Physicians, the Settling Insurers, and the Shareholders will make important contributions to the reorganization; 2) the release and injunction provisions are essential to the reorganization pursuant to the Plan; 3) a large majority of the creditors impacted by the release and injunction provisions approved the Plan; 4) there is a close connection between the claims of the non-debtors and the claims against the Debtor; and 5) the Plan provides for the payment of all of the claims affected by the release and injunction provisions of the Plan. These findings support injunctive relief based on statutory authority under the Code and the “unusual circumstance” case criteria. The evidence presented at the confirmation hearing supports the Bankruptcy Court’s findings.
There is no dispute that this case “is one of the world’s largest mass tort litigations, and the threatened consequences of the thousands of product liability claims arising from its manufacture and sale of silicone breast implants and silicone gel, [is the reason] Dow Corning filed a petition for reorganization
...” In re Dow Corning,
86 F.3d at 485 . “The potential for Dow Coming’s being held liable to the nondebtors in claims for contribution and indemnification, or vice versa, suffices to establish a conceivable impact on the estate in bankruptcy. Claims for indemnification and contribution, whether asserted against or by Dow Corning, obviously would affect the size of the estate and the length of time the bankruptcy proceedings will be pending, as well as Dow Coming’s ability to resolve its liabilities and proceed with reorganization.”
Id.
at 494 . Pursuant to the Sixth Circuit’s mandate, all the claims against the Shareholders were transferred to this District. To date, there are approximately 14,795 cases filed with this Court against the Shareholders. The cost to defend these number of cases by the Shareholders would have a substantial affect on the insurance policies shared with the Debtor.
Id.
at 494-95 . Any indemnification and contribution sought by the Shareholders against the Debtor relating to the manufacture of the breast implants would also substantially affect the Debtor’s estate. The bankruptcy action before this Court is an unusual case. The Bankruptcy Court erred in its conclusion of law that the bankruptcy court has no authority, statutory or otherwise, to issue a non-consensual permanent injunction in favor of non-debtor parties.
G.
The Parties’Arguments
1.
Proponents’Arguments
The Proponents (the Debtor and the TCC) argue that the December 21, 1999 Opinion is contrary to the plain meaning of the Joint Plan. The Joint Plan states that the release and injunction apply to “all Persons who have held, hold, or may hold Products Liability Claims, whether known or unknown.” Joint Plan, § 8.3. There is no ambiguity in the Plan language according to the Proponents, therefore, the Bankruptcy Court’s interpretation that the release only applied to “some” persons was wrong. All the parties, understood that the release and injunction provisions were non-consensual. Only the Bankruptcy Court read otherwise. The Amended Joint Disclosure Statement, approved by the Bankruptcy Court, and sent to all Claimants with the Joint Plan, made clear that under § 8.3 of the Joint Plan, “the Shareholders [and other Released Parties] ... will be released from any and all Products Liability Claims.... This means that anyone with a Claim relating to a Breast Implant or any of the other Claims being released will not be able to sue any of the Released Parties, including Dow Corning, Dow Chemical, Corning and the Settling
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Insurers.” D.Ct.R. 19, Tab 2 at 89. The Personal Injury Claimants also received a Special Note stating: “The Plan also provides that no further suits for claims based on the manufacture of silicone products may be brought against Dow Corning or its shareholders — Dow Chemical and Corning Incorporated.”
Id.,
Tab 3 at 2.
The Proponents agree with the Bankruptcy Court’s ruling that the release and injunction provisions in §§ 8.3 and 8.4 of the Joint Plan “are not inconsistent with the Code.” The Proponents point out that the Bankruptcy Court, in addition to its equitable powers in § 105(a), failed to look to § 1123(b)(6) as a source of power for the approval of the Joint Plan’s release and injunction provisions. The Proponents claim that the Bankruptcy Court did not follow the Supreme Court’s holding in
Energy Resources .
The Supreme Court held that the statutory directives found in §§ 105(a) and 1123(b)(6) give the Bankruptcy Courts, as courts of equity, broad authority to modify creditor-debtor relationships. 495 U.S. at 549 , 110 S.Ct. 2139 .
The Proponents further argue that the Bankruptcy Court failed to address the Sixth Circuit’s views concerning the importance of resolving the Claims against the Shareholders together with the Claims against the Debtor. The Sixth Circuit found that the claims for indemnification and contribution against or by Dow Corning and the overwhelming number of cases asserted against Dow Corning and the Shareholders would have an affect on the size of the bankruptcy estate, the length of time the bankruptcy proceedings will be pending, and the assets in the joint insurance held by Dow Corning and the Shareholders.
In re Dow Corning,
86 F.3d at 495 .
The Proponents contend that the Bankruptcy Court’s finding that the release and injunction provisions are contrary to non-bankruptcy law is in error. In any event, the Proponents argue that the non-bankruptcy law cited by the Bankruptcy Court supports the Bankruptcy Court’s equitable authority to order the full release of all Claims. In
Grupo Mexicano,
the Supreme Court stated that the limitations on the power to award injunctive relief does not apply to a court if a specific statute allows such power. The Bankruptcy Court’s power emanates not from the general equitable jurisdiction but from two sections of the Bankruptcy Code, § 1123(b)(6) and § 105(a). The Proponents argue that the release and injunction provision serve the public’s interest because the Joint Plan will permit the prompt and efficient resolution of tens of thousands of outstanding Tort Claims, provide for the adjudication and payment of all Claims that are not settled, and allow the Debtor to continue in business.
For the reasons set forth above, the Court finds that the release and injunction provisions are proper in this case.
2.
Nevada Claimants
The Nevada Claimants timely filed an appeal from the Bankruptcy Court’s November 30, 1999 Confirmation Order. The Nevada Claimants filed briefs taking two positions on the release and injunction issue: 1) that any injunction enjoining tort claimants who enter the Plan’s Settlement Facility to release non-debtor third-parties, is not fair and is not the law; and 2) even with the proviso that non-accepting tort claimants can choose to enter the Litigation Facility the third party release is not justified. The Nevada claimants agree with the Bankruptcy Court’s December 21, 1999 Best Interest of Creditors Opinion that the release required as a condition to receiving settlement funds does not apply to claimants who did not vote for the plan; the release provision of the Plan is not part of the Bankruptcy Court’s authority in equity; Section 105(a) is not authority for the Bankruptcy Court’s injunctive powers; and the injunction provision violates 11 U.S.C. § 524 (e).
As discussed above, the Bankruptcy Court does have authority under § 105(a)
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and various sections of the Bankruptcy Code to issue an injunction in favor of third-party non-debtors, especially in an unusual circumstances case such as exists in this bankruptcy. The Plan provides for claims against the Debtor and the non-debtors to be channeled to the Litigation Facility if the claimants choose not to enter into the Settlement Facility. The release and injunction provisions do not apply to claimants who choose to bring their claims against the Debtor and the non-debtors via the Litigation Facility. Contributions of assets, including insurance proceeds, meet the index of good faith and in this instance justify the release and injunction as to the Shareholders and the Settling Insurers.
Manville,
837 F.2d at 91 .
3.Class 5 Texas Children/Lacy Claimants
The Lacy Appellants in their response state that if the December 21st opinion of the Bankruptcy Court is stricken, the Bankruptcy Court erred in permanently enjoining the children claimants from prosecuting future claims against Dow Chemical, a non-party. The Lacy Appellants agree with the Bankruptcy Court’s December 21 Opinion that the release does not apply to claimants who did not vote for the plan.
Under the Plan, the Shareholders have agreed to fund the Plan in the amount of $2.35 billion (NPV) of their equity. 7/2/99 Tr., pp. 36, 44. The Shareholders agreed to the Joint Plan even though their equity in Dow Corning would be depleted by as much as $2.35 billion in exchange for the Shareholders’ rights to make claims against the insurance policies shared with Dow Corning. 6/28/99 Tr., pp. 158-59; 7/14/99 Tr., pp. 29-30, 94; 7/2/99 Tr., p. 40; 7/14/99 Tr., p. 34.
The record supports the Bankruptcy Court’s findings that the Shareholders and the Settling Insurers “will all make important contributions to the reorganization as part of a confirmed Plan” and that the release and injunction provisions “are essential to the reorganization pursuant to this Plan.” 11/30/99 Findings of Fact, ¶¶ 21-22. Cases have held that contributions of assets, including insurance proceeds, meet the index of good faith and, in this instance, justify the release and injunction as to the Shareholders and the Settling Insurers, even though claimants did not vote in favor of the Joint Plan.
Manville,
837 F.2d at 91 ;
In re Drexel Burnham,
960 F.2d at 293 .
4.
Marti Jacobs
Jacobs claims that the third-party releases should only be required of claimants in the Settlement Facility after the Plan is modified by the Plan Proponents. Jacobs agrees with the Bankruptcy Court that, at a minimum, those who voted against the Plan cannot be deemed to have released Dow Chemical. Jacobs argues that the release should be based on whether a claimant opts out of the Settlement Facility.
Modification of a Plan may be made by the proponent of a plan or the reorganized debtor at any time before confirmation. 11 U.S.C. § 1127 (a) and (b). In this case, the Joint Plan has been confirmed by the Bankruptcy Court. Unless the Bankruptcy Court’s Confirmation Order is reversed by this court or a court above, the Joint Plan stands as confirmed. The third-party release and injunction provisions cannot be changed as confirmed. For the reasons set forth above, there is sufficient authority under the Code and case law to support releases and injunctions in favor of the Shareholders in this bankruptcy action.
5.
Australian Claimants
The Australian Claimants argue that the Debtor’s affiliates have made no contributions to the funds or other consideration to the settlement. The Australian Claimants agree with the Bankruptcy Court that §§ 8.3 and 8.4 bind only those claimants who voted in favor of confirmation of the
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Joint Plan. The Australian Claimants argue that the Plan does not meet the factors set forth in the
Robins
case.
The record below indicates that the Shareholders and the Debtor’s affiliates have made significant contributions to fund the Joint Plan. The evidence at the confirmation hearing showed that the funding provided under the Joint Plan was “on a consolidated basis of Dow Corning Corporation and all of its subsidiary companies.” 7/14/99 Tr., p. 102. Sections 8.3 and 8.4 bind all claimants whether they voted in favor of or against the confirmation of the Join Plan, as discussed above.
In
In re Robins,
a release and permanent injunction in favor of third-party non-debtors were approved by the bankruptcy court based on the following factors: 1) that the chapter 11 petition was triggered by a mass tort; 2) claimants alleged that certain third party non-debtors were liable; 3) the release was essential to the reorganization; 4) the plan had overwhelming support from the constituency affected by the release; 5) a capped fund was established to pay tort claims; and, 6) the funds set aside for the tort claimants were to pay the claims in full.
In re Robins,
880 F.2d at 698-702 .
The objecting parties have failed to show that the Bankruptcy Court clearly erred in its findings of fact as to the release and injunction provisions. The Plan in this case meets all the factors set forth in
Robins.
There is no dispute that the Debtor filed the chapter 11 petition based on the thousands of breast implant claims against it.
In re Dow Corning,
86 F.3d at 485-86 . Claimants in this case allege that the Shareholders are also liable to them. The Bankruptcy Court found that there is a close connection between the claims against the third-party non-debtors and the claims against the Debtor. 11/30/99, Findings of Fact, ¶ 24. The Bankruptcy Court also found that the release was essential to the reorganization and that the third-parties made important contributions to the reorganization of the Plan. 11/30/99 Findings of Fact, ¶¶ 21-22. The Bankruptcy Court further found that a large majority of the creditors impacted by the release and injunction provisions approved the Plan. 11/30/99 Findings of Fact, ¶ 23. The Bankruptcy Court determined that the Plan provides for the payment of all of the claims affected by the release and injunction provisions of the Plan. 11/30/99 Findings of Fact, ¶ 25. In its Best Interest of Creditors Opinion, the Bankruptcy Court concluded that based on the evidence presented at the confirmation hearing, the funding of the Litigation Facility was adequate.
Best-Interests Opinion,
244 B.R. at 730, 731. The testimony of Tommy Jacks, a plaintiffs personal injury lawyer and a member of the Official Committee of Tort Claimants, was that the $400,000,000.00 net present value funding of the Litigation Facility was adequate to satisfy the non-settling claims in full. 244 B.R. at 730. Mr. Frederick C. Dunbar further testified that, based on a scientific approach in the calculation of whether the Litigation Facility was adequately funded, 7,513 people would choose the Litigation Facility. 244 B.R. at 731. The total nominal legal costs to resolve the breast implant and other claims and the administrative costs resolving these claims would be about $157.6 million, with a net present value of about $83 million.
Id.
Mr. Dunbar concluded that the $400 million net present value funding of the Litigation Facility is almost five times that necessary to satisfy all the claims channeled to the Litigation Facility.
Id.
The Bankruptcy Court found that even the witness called by the objecting claimants, Mr. John C. Thornton, corroborated Mr. Dunbar’s conclusions.
Id.
6.
Helene D. Schroeder
Ms. Schroeder, a claimant with a silicon gel chin implant, objects to the release as it applies to any claims against the attorneys representing the Tort Claimants’ Committee. Schroeder agrees with the Bankruptcy Court’s December 21, 1999
*485
Opinion limiting the release to those who voted in favor of the Plan. Schroeder claims that a Bankruptcy Court has no jurisdiction to alter the rights of creditors to collect debts from third parties and that the bankruptcy court only has jurisdiction over the Debtor and its property.
The Bankruptcy Court’s December 21, 1999 Opinion did not address the issue of whether the release and injunction provisions found in §§ 8.3 and 8.4 applied to claims against the attorneys representing the Tort Claimants’ Committee. The release provision applicable to the various committees is found in § 8.10 of the Joint Plan which states:
Upon the Effective Date, the Tort Committee, the Commercial Committee, the Physicians Committee, and each of their respective members, representatives and professionals, and all other professionals retained in the Case pursuant to § 327 of the Bankruptcy Code shall be deemed released from all claims and causes of action relating to the bankruptcy estate of Dow Corning or that have been or could be asserted by any party in interest in the Case of any Person acting on behalf of such party in interest.
Amended Joint Plan, § 8.10, p. 30.
The bankruptcy court has the power to approve the releases and issue an injunction with respect to the trustee, temporary receivers and creditors’ committees for matters in connection with the chapter 11 case.
In re Drexel Burnham, Lambert Group, Inc.,
138 B.R. 723, 753 (Bankr.S.D.N.Y.1992). Section 1103(e) of the Code grants to official creditors committees broad authority in formulating a plan for reorganization and performing “such other services as are in the interest of those represented.” 11 U.S.C. § 1103 (c). There is an implication that the Code grants committee representatives fiduciary duty to the committee’s constituents.
In re Mesta Mach. Co.,
67 B.R. 151, 156 (Bankr.W.D.Pa.1986). The fiduciary duty “extends to the class as a whole, not to its individual members.”
In re Drexel Burnham,
138 B.R. at 722 . At the same time, § 1103(c) gives rise to “an implicit grant of limited immunity.”
Id.
at 722
(quoting In re Tucker Freight Lines, Inc.,
62 B.R. 213, 216 (Bankr.W.D.Mich.1986)). The qualified immunity “corresponds to, and is intended to further, the Committee’s statutory duties and powers.”
Pan Am Corp. v. Delta Air Lines, Inc.,
175 B.R. 438, 514 (S.D.N.Y.1994). Such immunity applies to conduct within the scope of the authority conferred to the committee either by statute or the bankruptcy court.
Id.
To overcome this immunity, the party alleging breach of fiduciary duty must prove that the committee engaged in willful misconduct or “ultra vires” activity.
Id.
A claim that the committee members have acted outside the scope of their duties must first be brought to the Bankruptcy Court. Schroeder claims that the Tort Claimants Committee engaged in willful misconduct because they did not represent the interest of all personal injury claimants. Schroeder argues that the Committee only represented the interest of the breast implant claimants and not the non-breast implant claimants. There is nothing on the record which indicates that the Bankruptcy Court has had an opportunity to review such a claim. In any event, Schroeder has not presented sufficient evidence that the Tort Claimants Committee engaged in willful misconduct or conducted ultra vires activity.
Inasmuch as Schroeder is claiming that the Bankruptcy Court does not have the authority to approve the release provision pertaining to the Tort Claimants Committee representatives, this Court has found that the Bankruptcy Court does have such an authority. Sections 1102 and 1103 authorize the United States trustee to appoint various committees. Any expenses and salaries to committee members are borne by the Debtor. Any claims against the Tort Claimants Committee may give rise to indemnification or contri
*486
bution claims by the Committee against the Debtor’s estate. The Debtor’s assets would then be implicated. Based on the analysis previously made, the Bankruptcy Court has the authority to approve the Joint Plan which contains a release and injunction in favor of the Tort Claimants’ Committee under 11 U.S.C. § 105 (a) and §§ 1141(a), 1123(b)(3), 1123(b)(6) and 1129.
7.
United States
a.
Claims against the Debtor
The Government agrees with the Bankruptcy Court’s December 21 Opinion rejecting the Joint Plan’s release and injunc-tive provisions as to the United States’ Claims under the Medicare Secondary Payer Statute, 42 U.S.C. § 1395y and the Medical Care Recovery Act, 42 U.S.C. § 2651 , against non-debtor third parties. The United States argues that 11 U.S.C. §§ 105 and 1123(b)(6) confer no substantive rights at all. The Bankruptcy Court lacks the power to release or enjoin creditor claims against non-debtors and that only creditors consenting to the release and injunction could be bound by the provisions.
The United States claims that
Energy Resources
supports the United States’ argument more than the Proponents’ arguments. This Court’s analysis of the
Energy Resources
case establishes that the Supreme Court recognizes the bankruptcy court’s broad authority to modify creditor-debtor relationships under §§ 105(a), 1123(b)(5) and 1129.
Energy Resources,
495 U.S. at 549 , 110 S.Ct. 2139 . This Court’s reading of
Energy Resources
differs from the United States’ reading of the case. In
Energy Resources ,
the Supreme Court concluded that the statute cited by the IRS, by its terms, does not protect against the bankruptcy court’s authority under the Code to designate where tax payments may come from.
The United States argues that the Supreme Court’s decision in
Callaway v. Benton,
336 U.S. 132 , 69 S.Ct. 435 , 93 L.Ed. 553 (1949) is on point and favors the affirmance of the December 21 Opinion. In the
Callaway
case, the Supreme Court disapproved the permanent injunction of a suit by a shareholder stating that the bankruptcy statute does not give the bankruptcy court the right to require acceptance by a lessor not in reorganization of an offer for the purchase of its property. 336 U.S. at 136-41 , 69 S.Ct. 435 . The Court held that third-party claims are beyond the control of the bankruptcy court and cannot be enjoined, even if doing so is “essential” to the Debtor’s reorganization. The United States’ position that the
Calla-way
case is on point is to no avail given that the basis of the Supreme Court’s holding that the bankruptcy court lacked the power to permanently enjoin actions against non-debtors has since been changed. At the time, the
Callaway
decision was based on the bankruptcy court’s “exclusive and nondelegable control over the administration of an estate in its possession” and “exclusive jurisdiction of the debtor and its property wherever located.” 336 U.S. at 142 , 69 S.Ct. 435 . The Supreme Court noted that, “[t]here can be no question, however, that Congress did not give the bankruptcy court exclusive jurisdiction over all controversies that in some way affect the debtor’s estate.”
Id.
Since
Callaway ,
28 U.S.C. § 1334 (b) has been expanded to give the bankruptcy courts jurisdiction over cases “arising in or related to cases under title 11.” The Sixth Circuit has held that the Congressional intent was “to grant comprehensive jurisdiction to the bankruptcy courts so that they might deal efficiently and expeditiously with all matters connected with the bankruptcy estate.”
In re Dow Corning,
86 F.3d at 489 ,
citing Celotex Corp. v. Edwards,
514 U.S. 300, 308 , 115 S.Ct. 1493 , 131 L.Ed.2d 403 (1995). Proceedings “related to” a bankruptcy proceeding include “suits between third parties which have an effect on the bankruptcy estate.” 514 U.S. at 308, n. 5 , 115 S.Ct. 1493 . “[A] finding of definite liability of [an] estate as a condition precedent to holding an action
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related to a bankruptcy proceeding” is not required. 86 F.3d at 491 . The United States further argues that the Fourth Circuit’s A.
H. Robins
decision is wrong and is distinguishable in any event. As to the
Robins
case, the Court finds that it is applicable to this case and the factors have been met, as noted above.
Based on the above discussion, the Bankruptcy Court has jurisdiction over the claims against the third-parties in this case and to issue an injunction in this matter,
b.
Settling Insurers
With respect to the Settling Insurers, the United States argues that vacating the Bankruptcy Court’s December 21, 1999 Opinion would destroy the United States’ statutory rights against the Settling Insurers which were explicitly preserved by the Bankruptcy Court’s orders authorizing the settlements between the Debtor and the Settling Insurers. The Approval Orders entered by the Bankruptcy Court contained the following language:
Notwithstanding any provision of the Settlement Agreement or any other provisions of this Order, nothing in the Settlement Agreement or this Order shall limit any rights of the United States or its agencies against the Insurers, Dow Corning, or the Settlement Funds. Moreover, notwithstanding any provision of the Settlement Agreement or any other provision of this Order, nothing in the Settlement Agreement shall release the Insurers or Dow Corning from any obligations they may have under federal statutes and regulations, including but not limited to obligations that have arisen or may arise under the Medicare Secondary Payer Statute, 42 U.S.C. § 1395y, and its implementing regulations, 42 CFR 411. The United States and its agencies do not consent to the jurisdiction of this Court beyond any waiver of sovereign immunity.
August 11, 1995 Approval Order, ¶ 13A; March 25,1996 Approval Order, ¶ 11. The United States claims that the December 21, 1999 Opinion, as it stands, preserves its rights against the Settling Insurers as stated in the Approval Orders. Vacating the December 21, 1999 Opinion would destroy the language of the Approval Orders preserving the United States’ rights against the Settling Insurers.
The Approval Orders do state that “[njotwithstanding any provision of the Settlement Agreement or any other provisions of this Order, nothing
in the Settlement Agreement or this Order
shall limit any rights of the United States or its agencies against the Insurers.” August 11, 1995 Approval Order, ¶ 13A; March 25, 1996 Approval Order, ¶ 11 (emphasis added). However, the Approval Orders do not protect the United States’ rights from subsequent orders to be entered by the Bankruptcy Court, including the Bankruptcy Court’s Confirmation Order or any subsequent orders relating to the merits of the United States’ claims. It is noted that the Bankruptcy Court’s December 21, 1999 Opinion does not specifically address the issue raised by the United States on the release and injunction issue as it relates to the Settling Insurers. Because the contributions of assets, including insurance proceeds, meet the index of good faith, the release and injunction as to the Settling Insurers is appropriate.
Manville,
837 F.2d at 91 .
The Sixth Circuit noted the importance of the joint insurance held by the Debtor and its Shareholders:
Dow Corning, Dow Chemical and Corning Incorporated are co-insured under various insurance policies, which together provide over $1 billion in coverage. Dow Coming’s interest in the policies is one of the largest assets of its bankruptcy estate. In addition, Dow Corning recently entered into ten new insurance settlements under which the estate will receive, if approved by the bankruptcy court, approximately $350 to $450 million in cash. Most of these settlement involve policies under which
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Dew Chemical or Corning Incorporated is a co-insured.
Dow Corning, Dow Chemical, and Corning Incorporated claim that the district court’s order, by allowing thousands of claims to proceed separately against Dow Chemical and Corning Incorporated, will diminish the value of this major bankruptcy asset to the extent that settlements, judgment and defense costs incurred by the shareholders will exhaust policy limits otherwise available to Dow Corning, its creditors, and individuals asserting claims in the bankruptcy proceedings....
In re Dow Corning Corp.,
86 F.3d at 494 . Any release and injunction must apply not only to the Shareholders but to the Settling Insurers as well. Based on the analysis previously made, the release and injunction provisions apply to the United States’ claims against the Settling Insurers, as well as the Shareholders.
8.
Pennsylvania Class 5 Claimants
The Pennsylvania Class 5 Claimants argue that based on cases from the Ninth and Tenth Circuit, the non-debtor releases are not sufficient as a matter of law. The cases that have upheld the non-debtor releases show that there was consideration to the debtor. The Pennsylvania Class 5 Claimants object to the releases as they pertain to Settling Physicians and Health Care Providers. The Pennsylvania Class 5 Claimants argue that the release and injunction provisions do not meet the five prongs set forth in the
Robins
case. First, the Pennsylvania Class 5 Claimants’ tort claims will not be paid in full because they are required to release all doctors. Second, there was no overwhelming approval of the Plan because there was no overwhelming support of the Plan by the Pennsylvania Class 5 Claimants. Third, there is no substantial contribution as to the surgeons, doctors and healthcare providers under the Plan. Fourth, the release, as to the physicians and healthcare providers, is not necessary to the Debtor’s reorganization. Finally, there is no close connection between the claimants’ claims versus the healthcare providers and the Debtor. There is no identity interest as to the healthcare providers.
In response to the Pennsylvania Class 5 Claimants, the Class 12 Physicians and Class 13 Health Care Providers (“Settling Physicians and Health Care Providers”) seek to intervene in the appeals because they claim that no one represents their interests and they are not part of any Committee. They argue that while the Plan seems to “deem” Released Claims as to the Settling Physicians and Settling Health Care Providers as occurring on the Effective Date of the Plan, these claims are in reality not released until a Claimant affirmatively elects to become a “Settling Personal Injury Claimant,” and the physician and/or health care provider affirmatively elects to become a “Settling Physician” or “Settling Health Care Provider.” This two-tier mechanism provides that the Settling Physicians and Settling Health Care Providers obtain releases and injunctions that are expressly, inherently consensual, unlike the releases afforded to the Debtor-Affiliated and Shareholder-Affiliated Parties. The Settling Physicians and Health Care Providers argue that the December 21, 1999 Opinion, if it applies, only applies to those non-consensual releases/injunctions ' affecting the Debtor-Affiliated and Shareholder-Affiliated Parties, but not to Settling Physicians or Settling Health Care Providers. The Plan provides no election process to a Claimant prior to releasing claims against the Debt- or-Affiliated and Shareholder Affiliated Parties, whereas, a Claimant must first elect to become a “Settling Personal Injury Claimant” and the physician/healthcare provider affirmatively elects to become a “Settling Physician” or “Settling Health Care Provider.” The Class 12 Physicians and Class 13 Healthcare Providers seek a ruling that the December 21, 1999 Opinion does not apply to their situation because the release and injunction provisions as
*489
they apply to the Settling Physicians and Healthcare Providers are consensual in nature because of the two-tier election mechanism under the Plan.
The Court notes that the December 21, 1999 Opinion states that other released parties under §§ 8.3 and 8.4 “include ... health-care providers in Classes 12 and 13
who settle their respective claims against the Debtor.” Best-Interests Opinion,
244 B.R. at 736 (emphasis added). The Proponents of the Plan do not address this issue in their briefs. The Court will consider the Class 12 Physicians and Class 13 Healthcare’s Motion to Intervene as Motion to file an Amicus Curiae brief given that this matter is on appeal from the Bankruptcy Court and intervention is not procedurally proper on appeal as noted above.
Specifically, as it relates to the Class 12 Physicians and Class 13 Healthcare Providers, § 8.3 states:
Except as otherwise expressly provided in this Plan and in this section 8.3, in consideration of ... (d)
the release of Claims against the Debtor-Affiliated Parties by the Settling Physicians and Settling Health Care Providers,
on the Effective Date ... (ii) all Persons who hold or may have held Personal Injury Claims shall be deemed to have forever waived and released all such rights or Claims, whether based upon tort or contract or otherwise, that they heretofore, now or hereafter possess or may possess against the Settling Physicians (except for Malpractice Claims) or the Settling Health Care Providers (except for Malpractice Claims) ...
%
# ‡ # ‡ 5]c
This section 8.3 shall not operate as a release or waiver of any Malpractice Claim held against a Settling Physician or a Settling Health Care Provider by a Settling Personal Injury Claimant. Malpractice Claims, if any, asserted by Settling Personal Injury Claimants shall be resolved in the courts where actions based on such Claims have been (or may be) filed. Moreover, this section 8.3 shall not operate as a release or waiver in favor of the Settling Physicians and the Settling Health Care Providers of the rights or Claims of Non-Settling Personal Injury Claimants. Such rights and Claims shall be preserved, subject to section 8.6 of this Plan. This Section 8.3 shall not operate as a release or waiver of those Claims preserved under the Domestic Health Insurer Settlement Agreement.
§ 8.3, Amended Joint Plan of Reorganization (emphasis added). Section 8.5 of the Amended Plan provides for the channeling of the claims by
“Non^Settling Personal Injury Claimants against the Settling Physicians and the Settling Health Care Providers (other than Malpractice Claims).”
“Non-Settling Personal Injury Claimants” are “those Personal Injury Claimants (other than Claimants in Classes 6A, 6B, 6C and 6D) who are not Settling Personal Injury Claimants.” § 1.110, Amended Joint Plan of Reorganization. “Settling Personal Injury Claimants” are those “Personal Injury Claimants (other than Claimants in Classes 6A, 6B, 6C and 6D) who elect to settle their Claims under the terms of the Settlement Facility, together with those Personal Injury Claimants who do not timely return an Election Form.” § 1.161, Amended Joint Plan of Reorganization. “Settling Health Care Providers” are those “who timely elect to settle their Claims against the Debtor” and “Settling Physicians” are those “who timely elect to settle their Claims against the Debtor.” §§ 1.159 and 1.162, Amended Joint Plan of Reorganization.
Based on the express language of the Plan, it is clear that any “release” of claims against the Physicians and the Healthcare Providers do not include malpractice claims. Section 8.3 clearly states that malpractice claims against the Physicians and Healthcare Providers are not deemed released under the Plan. Additionally, § 8.3
*490
provides that in order for § 8.3 to apply, the Physicians and Healthcare Providers must first become “Settling Physicians” and “Settling Health Care Providers.” In order to do that, the Settling Physicians and Settling Health Care Providers must “release” their “Claims” against the Debt- or and its affiliates by timely electing to settle their Claims against the Debtor and its affiliates. §§ 8.3(d), 1.159 and 1.162, Amended Joint Plan of Reorganization.
Section 8.3 does not automatically release the Physicians and Healthcare Providers. A Personal Injury Claimant must first elect to settle her Claims against the Debtor. A Physician and/or Healthcare Provider must also elect to settle their Claims against the Debtor. Otherwise, § 8.3 does not apply. The consideration under § 8.3 as it applies to the Physicians and Healthcare Providers is that they must release their Claims against the Debtor in order for § 8.3 to apply to the Claims by the Personal Injury Claimants against the Physicians and Healthcare Providers. As argued by the Class 12 Physicians and Class 13 Healthcare Providers, in order for the release provision to apply, a two-step process is involved: the Personally Injury Claimant must elect to settle their Claims against the Debtor and the Class 12 Physicians and Class 13 Healthcare Providers must also elect to settle their Claims against the Debtor. If the Personal Injury Claimant chooses not to settle their Claims with the Debtor, then those Claims are dealt with pursuant to the Litigation Facility Agreement. If the Physicians or Healthcare Providers choose not to settle their Claims against the Debtor, then, even if the Personal Injury Claimants elect to settle their Claims with the Debtor, the Claims against the Physicians or Healthcare Providers are resolved in the Litigation Facility. If the Personal Injury Claimants do not elect to settle them Claims with the Debtor, but the Physicians or Healthcare Providers elect to settle their Claims against the Debtor, then the Claims against the Physicians or Healthcare Providers are not deemed released but are channeled to the Litigation Facility under § 8.5.
The Court finds that the Release provision only applies to Personal Injury Claimants and Physicians and/or Healthcare Providers when both elect to become settling parties. A voluntary and consensual release is not a discharge in bankruptcy and does not run afoul with the Bankruptcy Code.
See In re Arrowmill,
211 B.R. at 506. If the Personal Injury Claimants elect to settle their claims against the Debtor, their Claims would be paid in full because any malpractice claims against the Physicians and/or Healthcare Providers, whether they have elected to settle or not, are not deemed released under § 8.3. Any Personal Injury Claimant is allowed to pursue malpractice claims against a physician where the cause of action was or is to be filed based on the express language of § 8.3.
Although the Pennsylvania Class 5 Claimants argue that
within
the Pennsylvania Class 5 Claimants, there was no overwhelming approval of the Plan, the Bankruptcy Court’s finding that “a large majority of the creditors impacted by the release and injunction provisions approved the Plan” is supported by the record and is not a clearly erroneous finding. The Bankruptcy Court’s finding that the “important contributions to the reorganization” are made by the Settling Physicians is also supported by the record. The Settling Physicians and the Settling Healthcare Providers release of their Claims against the Debtor, if they so elect, is an important contribution and consideration to the reorganization. Any release by the Settling Physicians and the Settling Healthcare Providers would contribute to the Estate of the Debtor. The Bankruptcy Court’s finding that the Release, as to the Physicians and Healthcare Providers, are “essential” to the reorganization of the Plan is not clearly erroneous and is supported by the record. The Bankruptcy
*491
Court’s finding that there is a “close connection” between the claims of the Physicians and the Healthcare Providers on the one hand and the claims against the Debt- or on the other hand is also supported by the record and is not clearly erroneous. The Claims by the Physicians and the Healthcare Providers against the Debtor involve the Debtor’s misrepresentations about the breast implants and/or raw materials in its marketing to the Physicians and Healthcare Providers. The Claims by the Personal Injury Claimants against the Debtor involve its misrepresentations and the manufacture of the breast implants and or raw materials to the Claimants. The Claims are closely connected. The Release provision, as it applies to the Class 5 Pennsylvania Claimants and the Settling Physicians and Settling Healthcare Providers also meets the best interest of creditors test.
9.
Settling Insurers
Certain Underwriters at Lloyd’s, London and Certain London Market Insurance Companies (“London Market Insurers”), join in the arguments of the Proponents and the Hartford Insurers. The Bankruptcy Court entered an order approving the settlement between the Debtor and the London Market Insurers. The London Market Insurers claim that the releases contained in the Joint Plan were a key element of the consideration that the London Market Insurers received in exchange for their settlement payments to the Debt- or. The London Market Insurers contend that if the December 21 Opinion stands, it would be an impermissible modification of the London Market Insurers’ settlement and the settlement would be a nullity. The insurance issue was a hotly contested litigation in the Wayne County Circuit Court, State of Michigan. After lengthy hearings before the Bankruptcy Court, the settlement was approved between the London Market Insurers and the Debtors. The effectiveness of the settlement was expressly conditioned upon the entry of an approval order containing releases of the London Market Insurers effective against non-parties to the bankruptcy case. The money provided by the London Market Insurers and the other Settling Insurers has formed the bedrock of the Plan of Reorganization. Any modification of the settlement by the December 21, 1999 Opinion should be vacated.
On August 11,

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/1961422. Public record. Not legal advice.