By Emily Chasan
NEW YORK, Jan 13 (Reuters) - A U.S. bankruptcy judge on Wednesday approved a Lehman Brothers Holdings Inc plan to speed up the process of resolving some 65,000 creditor claims by handling certain objections in bulk.
At a hearing in U.S. Bankruptcy Court in Manhattan, Judge James Peck approved the plan, saying it would apply to all creditors except 10 who still opposed Lehman's plan and would be given an opportunity to object to it in February.
Lehman had sought approval of the plan to file so-called 'omnibus' objections to creditors' claims, saying the process would be more efficient than objecting to each claim individually and help it keep its bankruptcy case on track. The plan could affect some $830 billion in creditors' claims against Lehman.
The plan will 'streamline the claims process that we feel would otherwise overwhelm our resources as well as the resources of the court,' Shai Waisman, a Weil Gotshal & Manges attorney representing Lehman Brothers, said at the hearing.
Lehman, which filed the largest bankruptcy case in U.S. history on Sept. 15, 2008, is facing the task of reconciling over 65,000 claims filed against it by creditors, as well the more than 46,000 other scheduled claims.
The omnibus objections would apply only to claims that fall into broad situations, such as when a creditor's claim contradicts Lehman's records, lacks documentation, or was incorrectly classified.
The plan faced opposition from a group of 10 creditors led by France's Societe Generale SA and Canada's Canadian Imperial Bank of Commerce, which claimed that U.S. law didn't allow the sending out of something tantamount to a form letter to reject a claim.
Judge Peck on Wednesday approved a plan that would excuse the 10 objecting creditors from being subject to the plan for now, while it would take effect for the other 64,990 or so creditors.
Judge Peck said he viewed Lehman's request as 'administrative in nature' and that it 'represents, if anything, an improvement over what has become standard practice in filing omnibus objections.' However, he said he would reserve the right to make changes to Lehman's entire plan at a later date if one of the objectors convinces him he should do so.
Lehman is also seeking court approval for a plan to more efficiently settle creditor claims. Lehman has said it expects a large number of claims could be settled for small amounts under $50 million and without a more efficient process it would otherwise have to seek specific court approval for each individual compromise.
Waisman said on Wednesday that Lehman was working with Lehman's official committee of unsecured creditors on the proposal to streamline claims settlements.
The judge will hear that request along with remaining objections to the claims process at a hearing on Feb. 10.
The case is In re: Lehman Brothers Holdings Inc, U.S. Bankruptcy Court, Southern District of New York, No. 08-13555.
(Reporting by Emily Chasan; Editing by Richard Chang) Keywords: LEHMANBROTHERS/ (emily.chasan@thomsonreuters.com; +1 646 223 6114; Reuters Messaging: emily.chasan.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
NEW YORK, Jan 13 (Reuters) - A U.S. bankruptcy judge on Wednesday approved a Lehman Brothers Holdings Inc plan to speed up the process of resolving some 65,000 creditor claims by handling certain objections in bulk.
At a hearing in U.S. Bankruptcy Court in Manhattan, Judge James Peck approved the plan, saying it would apply to all creditors except 10 who still opposed Lehman's plan and would be given an opportunity to object to it in February.
Lehman had sought approval of the plan to file so-called 'omnibus' objections to creditors' claims, saying the process would be more efficient than objecting to each claim individually and help it keep its bankruptcy case on track. The plan could affect some $830 billion in creditors' claims against Lehman.
The plan will 'streamline the claims process that we feel would otherwise overwhelm our resources as well as the resources of the court,' Shai Waisman, a Weil Gotshal & Manges attorney representing Lehman Brothers, said at the hearing.
Lehman, which filed the largest bankruptcy case in U.S. history on Sept. 15, 2008, is facing the task of reconciling over 65,000 claims filed against it by creditors, as well the more than 46,000 other scheduled claims.
The omnibus objections would apply only to claims that fall into broad situations, such as when a creditor's claim contradicts Lehman's records, lacks documentation, or was incorrectly classified.
The plan faced opposition from a group of 10 creditors led by France's Societe Generale SA and Canada's Canadian Imperial Bank of Commerce, which claimed that U.S. law didn't allow the sending out of something tantamount to a form letter to reject a claim.
Judge Peck on Wednesday approved a plan that would excuse the 10 objecting creditors from being subject to the plan for now, while it would take effect for the other 64,990 or so creditors.
Judge Peck said he viewed Lehman's request as 'administrative in nature' and that it 'represents, if anything, an improvement over what has become standard practice in filing omnibus objections.' However, he said he would reserve the right to make changes to Lehman's entire plan at a later date if one of the objectors convinces him he should do so.
Lehman is also seeking court approval for a plan to more efficiently settle creditor claims. Lehman has said it expects a large number of claims could be settled for small amounts under $50 million and without a more efficient process it would otherwise have to seek specific court approval for each individual compromise.
Waisman said on Wednesday that Lehman was working with Lehman's official committee of unsecured creditors on the proposal to streamline claims settlements.
The judge will hear that request along with remaining objections to the claims process at a hearing on Feb. 10.
The case is In re: Lehman Brothers Holdings Inc, U.S. Bankruptcy Court, Southern District of New York, No. 08-13555.
(Reporting by Emily Chasan; Editing by Richard Chang) Keywords: LEHMANBROTHERS/ (emily.chasan@thomsonreuters.com; +1 646 223 6114; Reuters Messaging: emily.chasan.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
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