25 mars, 2007 16:04
Supreme Court refuses to consider Dow Corning bankruptcy case
(AP) - WASHINGTON-The Supreme Court refused Monday to consider a case stemming from a longstanding bankruptcy dispute between Dow Corning Corp. and a group of its creditors, which includes investment bank Merrill Lynch & Co. Inc. and Bank of America Corp.
At issue in the dispute is the interest rate that Dow Corning must pay on the debts it owes the creditors. The difference between the rate that Dow is willing to pay and the rate its creditors are demanding amounts to "tens of millions of dollars," according to Dow Corning's petition to the court.
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The case also involves a larger issue, the company said: specifically, the finality of bankruptcy settlements. Dow Corning argues that a bankruptcy court confirmed a plan settling the company's bankruptcy in 1999, and under bankruptcy law that plan should be shielded from further legal challenge.
Lawyers for the creditors' group, which also includes JP Morgan Chase & Co. and Bear Stearns Cos. Inc., argue that they are not seeking to overturn the bankruptcy court's ruling but to properly enforce its terms.
The 6th Circuit Court of Appeals ruled in favor of the creditors' group in July 2006, finding that the bankruptcy court erred in approving a settlement that was not consistent with bankruptcy law.
Dow Corning, a joint venture between Dow Chemical Co. and Corning Inc., was a leading manufacturer of silicone breast implants until the Food and Drug Administration banned them in 1992. The company sought Chapter 11 bankruptcy protection in May 1995 after being hit with 19,000 lawsuits.
The company emerged from bankruptcy in 2004. The FDA, meanwhile, ended its ban on silicone implants in November 2006.
The case is Dow Corning Corp. vs. Committee of Unsecured Creditors, 06-705. Justice Stephen Breyer did not participate in the decision, the court said, without giving any reasons.
2007-03-26T17:30:25Z
