t ruled that "the FCR standard requires more than disinterestedness." According to Judge Krause, "[a]n FCR must be able to act in accordance with a duty of independence from the debtor and other parties in interest in the bankruptcy, a duty of undivided loyalty to the future claimants, and an ability to be an effective advocate for the best interests of the future claimants." Id. (footnote omitted).The Third Circuit reached this conclusion after considering the text of the Bankruptcy Code and its legislative history, the standards traditionally applied to creditors' committees—which, the court explained, serve an analogous role in bankruptcy cases—and "the administrability of the fiduciary standard … in the bankruptcy context." Id.First, the Third Circuit reasoned, Congress specifically chose to use the "disinterested person" standard in 11 other provisions of the Bankruptcy Code, yet omitted it from section 524(g). Id. at 375 (citing 11 U.S.C. §§ 327(a), 328(c), 332(a), 333(a)(2)(A), 701(a)(1), 703(c), 1104(b)(1), 1104(d), 1163, 1183(a), 1202(a) and 1302(a)). This is not surprising, Judge Krause wrote, because the provisions containing the "disinterested person" standard "relate to professionals whose duties run to the entire estate or to the court, requiring that they remain impartial" and do not represent any adverse interest, whereas the FCR is the "'legal representative' for just such an adverse interest, having been appointed specifically 'for the purpose of protecting the rights of' future asbestos claimants." Id. (quoting 11 U.S.C. § 524(g)(4)(B)(i)). The Third Circuit accordingly concluded that this statutory omission "counsels against" adopting the disinterested person standard for the purpose of FCR appointments.Next, the Third Circuit reasoned that lawmakers' usage of the term "legal representative"—a term of art referring to someone owing fiduciary duties to absent constituents—in section 524(g) indicates they anticipated an FCR should "be able to fulfill the he

In a Chapter 7 bankruptcy, a trustee liquidates the debtor’s assets and distributes them to creditors. Czyzewski v. Jevic Holding Corp., 137 S.Ct. 973, 978 (2017) (citing 11 U.S.C. §701 et seq.). In a Chapter 11 bankruptcy, a debtor business and its creditors negotiate a plan that will govern the distribution of the estate’s assets, often keeping the business operating as a going concern.

In a Chapter 7 bankruptcy, a trustee liquidates the debtor’s assets and distributes them to creditors. Czyzewski v. Jevic Holding Corp., 137 S.Ct. 973, 978 (2017) (citing 11 U.S.C. § 701 et seq.). In a Chapter 11 bankruptcy, a debtor business and its creditors negotiate a plan that will govern the distribution of the estate’s assets, often keeping the business operating as a going concern.