Third Circuit disposition — 23-1664

PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
________________
Nos. 23-1664, 23-1665, 23-1666, 23-1667, 23-1668, 23-1669,
23-1670, 23-1671, 23-1672, 23-1673, 23-1674, 23-1675,
23-1676, 23-1677, 23-1678 & 23-1780
________________
In re: BOY SCOUTS OF AMERICA and DELAWARE
BSA LLC,
Debtors
LUJAN CLAIMANTS,
Appellants in No. 23-1664
LIBERTY MUTUAL INSURANCE COMPANY; THE
OHIO CASUALTY INSURANCE COMPANY; LIBERTY
INSURANCE UNDERWRITERS, INC.; LIBERTY
SURPLUS INSURANCE CORPORATION,
Appellants in No. 23-1665
DUMAS & VAUGHN CLAIMANTS,
Appellants in No. 23-1666
THE CONTINENTAL INSURANCE COMPANY;
COLUMBIA CASUALTY COMPANY,
Appellants in No. 23-1667

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NATIONAL UNION FIRE INSURANCE CO OF
PITTSBURGH PENNSYLVANIA; LEXINGTON
INSURANCE COMPANY; LANDMARK INSURANCE
COMPANY; THE INSURANCE COMPANY OF THE
STATE OF PENNSYLVANIA,
Appellants in No. 23-1668
INDIAN HARBOR INSURANCE COMPANY,
Appellant in No. 23-1669
OLD REPUBLIC INSURANCE COMPANY,
Appellant in No. 23-1670
TRAVELERS CASUALTY AND SURETY COMPANY,
INC.; ST. PAUL SURPLUS LINES INSURANCE
COMPAN; GULF INSURANCE COMPANY,
Appellants in No. 23-1671
GREAT AMERICAN ASSURANCE COMPANY; GREAT
AMERICAN E&S INSURANCE COMPANY,
Appellants in No. 23-1672
ALLIANZ GLOBAL RISKS US INSURANCE COMPANY;
NATIONAL SURETY CORPORATION; INTERSTATE
FIRE & CASUALTY COMPANY,
Appellants in No. 23-1673
ARGONAUT INSURANCE COMPANY; COLONY
INSURANCE COMPANY,
Appellants in No. 23-1674
GEMINI INSURANCE COMPANY,
Appellant in No. 23-1675

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GENERAL STAR INDEMNITY COMPANY,
Appellant in No. 23-1676
ARROWOOD INDEMNITY COMPANY,
Appellant in No. 23-1677
TRADERS AND PACIFIC INSURANCE COMPANY;
ENDURANCE AMERICAN SPECIALTY INSURANCE
COMPANY; ENDURANCE AMERICA INSURANCE
COMPANY,
Appellants in No. 23-1678
ARCH INSURANCE COMPANY,
Appellant in No. 23-1780
________________
On Appeal from the United States District Court
for the District of Delaware
(D.C. Nos. 1:22-cv-01237, 1:22-cv-01238, 1:22-cv-01239,
1:22-cv-01240, 1:22-cv-01241, 1:22-cv-01243, 1:22-cv-
01244, 1:22-cv-01245, 1:22-cv-01246, 1:22-cv-01247, 1:22-
cv-01249, 1:22-cv-01250, 1:22-cv-01251, 1:22-cv-01252,
1:22-cv-01258, 1:22-cv-01263)
District Judge: Honorable Richard G. Andrews
________________
Argued on November 6, 2024
Before: KRAUSE, SCIRICA, and RENDELL, Circuit Judges
(Opinion filed: May 13, 2025)

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Gilion C. Dumas [ARGUED]
Dumas & Vaughn, LLC
3835 NE Hancock St., Suite GLB
Portland, OR 97212
Charles J. Brown, III
Gellert Scali Busenkell & Brown LLC
1201 N. Orange St., 3rd Fl.
Wilmington, DE 19801
Counsel for Appellants Dumas & Vaughn Claimants
Delia Lujan Wolff [ARGUED]
Lujan & Wolff LLP
Suite 300, DNA Bldg.
238 Archbishop Flores St.
Hagatna, Guam 96910
Christopher D. Loizides
Loizides, P.A.
1225 King St., Suite 800
Wilmington, DE 19801
Counsel for Appellants Lujan Claimants
Deirdre M. Richards
Fineman Krekstein & Harris PC
1300 N. King St.
Wilmington, DE 19801
Susan N. Gummow
Foran Glennon Palandech Ponzi & Rudloff P.C.
222 N. LaSalle St., Suite 1400

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Chicago, IL 60601
Theodore J. Boutrous Jr.
Richard J. Doren
Blaine H. Evanson
Gibson, Dunn & Crutcher LLP
333 South Grand Ave.
Los Angeles, CA 90071
Michael A. Rosenthal
James Hallowell
Seth M. Rokosky
Gibson, Dunn & Crutcher LLP
200 Park Ave.
New York, NY 10166
Joseph T. Baio [ARGUED]
Christopher J. St. Jeanos
Patricia O. Haynes
Willkie Farr & Gallagher LLP
787 Seventh Ave.
New York, NY 10019
Counsel for Appellants National Union Fire Insurance
Company of Pittsburgh, Pa., Lexington Insurance
Company, Landmark Insurance Company, and the
Insurance Company of the State of Pennsylvania
Ronald P. Schiller
Matthew A. Hamermesh
Hangley Aronchick Segal Pudlin & Schiller
One Logan Square, 27th Fl.
Philadelphia, PA 19103

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Kathleen M. Miller
Smith, Katzenstein & Jenkins LLP
1000 West St., Suite 501
P.O. Box 410
Wilmington, DE 19899
Counsel for Appellant Arch Insurance Company
Kathleen K. Kerns
Paul A. Logan
Post & Schell, P.C.
Four Penn Center, 13th Fl.
1600 John F. Kennedy Blvd.
Philadelphia, PA 19103
George R. Calhoun
Ifrah PLLC
1717 Pennsylvania Ave., N.W., Suite 650
Washington, DC 20006
Counsel for Appellants Argonaut Insurance Company
and Colony Insurance Company
Michael J. Joyce
Joyce, LLC
1225 King St., Suite 800
Wilmington, DE 19801
Lorraine Armenti
Michael Hrinewski
Coughlin Midlige & Garland, LLP
350 Mount Kemble Ave.

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PO Box 1917
Morristown, NJ 07962
Counsel for Appellant Arrowood Indemnity Company
Maria A. Sawczuk
Goldstein & Mcclintock LLLP
501 Silverside Rd., Suite 65
Wilmington, DE 19809
David Christian
David Christian Attorneys LLC
105 W. Madison St., Suite 1400
Chicago, IL 60602
Counsel for Appellants Continental Insurance
Company and Columbia Casualty Company
William H. White Jr.
Kiernan Trebach LLP
1233 20th St., NW, 8th Fl.
Washington, DC 20036
John E.W. Baay II
Gieger Laborde & Laperouose, LLC
701 Poydras St., Suite 4800
New Orleans, LA 70139
Counsel for Appellant Gemini Insurance Company
Kelly A. Green
Smith, Katzenstein & Jenkins LLP

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1000 West St., Suite 501
P.O. Box 410
Wilmington, DE 19899
Mary E. Borja
Gary P. Seligman
Ashley L. Criss
Wiley Rein LLP
2050 M St. NW
Washington, DC 20036
Counsel for Appellant General Star Indemnity
Company
Konrad R. Krebs
Clyde & Co US LLP
340 Mt. Kemble Ave., Suite 300
Morristown, NJ 07960
Alexander E. Potente
Bruce D. Celebrezze
Clyde & Co US LLP
150 California St., 15th Fl.
San Francisco, CA 94111
David Christian
David Christian Attorneys LLC
105 W. Madison St., Suite 1400
Chicago, IL 60602
Bruce W. McCullough
Bodell Bove, LLC

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1225 N. King St., Suite 1000
Wilmington, DE 19801
Counsel for Appellants Great American Assurance
Company and Great American E&S Insurance
Company
Kathleen M. Miller
Smith, Katzenstein & Jenkins LLP
1000 West St., Suite 501
P.O. Box 410
Wilmington, DE 19899
Lloyd A. Gura
Pamela J. Minetto
Mound Cotton Wollan & Greengrass LLP
One New York Plaza 44th Fl.
New York, NY 10004
Counsel for Appellant Indian Harbor Insurance
Company
Douglas R. Gooding
Jonathan D. Marshall
Bryana T. McGillycuddy
Choate, Hall & Stewart LLP
Two International Place
Boston, MA 02110
Kim V. Marrkand
Mintz, Levin, Cohn, Ferris, Glovsky and Popeo PC
One Financial Center
Boston, MA 02111

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R. Karl Hill
Seitz, Van Ogtrop & Green, P.A.
222 Delaware Ave., Suite 1500
Wilmington, DE 19801
Counsel for Appellants Liberty Mutual Insurance
Company, Ohio Casualty Insurance Company, Liberty
Insurance Underwriters, Inc., and Liberty Surplus
Insurance Corporation
Marla S. Benedek
Cozen O’Connor
1201 N. Market St., Suite 1001
Wilmington, DE 19801
Counsel for Appellants Traders and Pacific Insurance
Company, Endurance American Specialty Insurance
Company, and Endurance American Insurance
Company
Louis J. Rizzo, Jr.
Reger Rizzo & Darnall LLP
1521 Concord Pike
Brandywine Plaza West Suite 305
Wilmington, DE 19803
Counsel for Appellants Travelers Casualty and Surety
Company, Inc., St. Paul Surplus Lines Insurance
Company and Gulf Insurance Company
Stephen M. Miller
Carl N. Kunz, III

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Morris James LLP
500 Delaware Ave., Suite 1500
Wilmington, DE 19801
Counsel for Appellant Old Republic Insurance
Company
Margaret H. Warner
Ryan S. Smethurst
Alex M. Spisak
McDermott Will & Emery LLP
The McDermott Building
500 North Capital St., NW
Washington, DC 20001-1531
Counsel for Appellant Allianz Global Risks US
Insurance Company
David M. Fournier
Troutman Pepper Locke LLP
1313 N. Market St., Suite 5100
P.O. Box 1709
Wilmington, DE 19899
Harris B. Winsberg [ARGUED]
Matthew G. Roberts
Parker, Hudson, Rainer & Dobbs LLP
303 Peachtree St. NE, Suite 3600
Atlanta, GA 30308
Todd C. Jacobs
John E. Bucheit
Parker, Hudson, Rainer & Dobbs LLP

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Two N. Riverside Plaza, Suite 1850
Chicago, IL 60606
Counsel for Appellants Allianz Global Risks US
Insurance Company, Interstate Fire & Casualty
Company, and National Surety Corporation
David R. Kuney
9200 Cambridge Manor Ct.
Potomac, MD 20854
Counsel for Amici Curiae Honorable Eugene Wedoff
(Ret.) And Law Professors Ralph Brubaker, David
Epstein, George Kuney, David Kuney, Jonathan Lipson,
Juliet Moringiello, Chrystin Ondersma and Lawrence
Ponoroff in Support of Appellants Dumas & Vaughn
Claimants
Michael Huston [ARGUED]
Perkins Coie
2525 E Camelback Rd., Suite 500
Phoenix, AZ 85016
Jessica C. Lauria
Glenn M. Kurtz [ARGUED]
White & Case LLP
1221 Ave. of the Americas
New York, NY 10020
Matthew E. Linder
White & Case LLP
111 South Wacker Dr.
Chicago, IL 60606

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Ronald K. Gorsich
White & Case LLP
555 South Flower St., Suite 2700
Los Angeles, CA 90071
Derek C. Abbott
Andrew R. Remming
Sophie Rogers Churchill
Morris, Nichols, Arsht & Tunnell LLP
1201 North Market St., 16th Fl.
P.O. Box 1347
Wilmington, DE 19899
Counsel for Appellees Boy Scouts of America and
Delaware BSA, LLC
Philip D. Anker [ARGUED]
Wilmer Cutler Pickering Hale & Dorr LLP
7 World Trade Center
250 Greenwich St.
New York, NY 10007
Daniel N. Brogan
Gregory J. Flasser
Bayard
600 N King St., Suite 400
Wilmington, DE 19801
Counsel for Appellees Hartford Accident and Indemnity
Company, First State Insurance Company, Twin City
Fire Insurance Company, and Navigators Specialty
Insurance Company

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Stephen H. Warren
O’Melveny & Myers LLP
400 South Hope St.
Los Angeles, CA 90071-2899
Tancred Schiavoni
Nicole Molner
O’Melveny & Myers LLP
Seven Times Square
New York, NY 10036
Jonathan D. Hacker [ARGUED]
O’Melveny & Myers LLP
1625 Eye St., N.W.
Washington, DC 20006
Counsel for Appellee Century Indemnity Company
David Elbaum
Simpson Thacher & Barlett LLP
425 Lexington Ave.
New York, NY 10017
Stamatios Stamoulis
Stamoulis & Weinblatt
800 N West St., 3rd Fl.
Wilmington, DE 19801
Counsel for Appellees Federal Insurance Company and
Westchester Fire Insurance Company
Matthew G. Summers
Ballard Spahr LLP

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919 N. Market St., 11th Fl.
Wilmington, DE 19801
Counsel for Appellees Clarendon National Insurance
Company, River Thames Insurance Company Limited,
and Zurich American Insurance Company
Robert D. Cecil, Jr.
Tybout, Redfearn & Pell
501 Carr Rd., Suite 300
Wilmington, DE 19899
Counsel for Appellees American Zurich Insurance
Company, American Guarantee Insurance Company,
and Steadfast Insurance Company
R. Craig Martin
DLA Piper, LLP (US)
1201 North Market St., Suite 2100
Wilmington, DE 19801
Counsel for Appellees Ad Hoc Committee of Local
Councils
Robert S. Brady
Edwin J. Harron
Kenneth J. Enos
Ashley E. Jacobs
Young Conaway Stargatt & Taylor, LLP
Rodney Square
1000 North King St.
Wilmington, DE 19801

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Kami E. Quinn [ARGUED]
Emily P. Grim
December L. Huddleston
Kyle Y. Dechant
Gilbert LLP
700 Pennsylvania Ave., SE, Suite 400
Washington, DC 20003
Counsel for Appellee Future Claimants’ Representative
Eric R. Goodman
David J. Molton
Brown Rudnick
7 Times Square, 47th Fl.
New York, NY 10036
Rachel B. Mersky
Monzack Mersky McLaughlin & Browder
1201 North Orange St., Suite 400
Wilmington, DE 19801
Counsel for Appellee Coalition of Abused Scouts for
Justice
David M. Klauder
Bielli & Klauder, LLC
1204 N. King St.
Wilmington, DE 19801
Thomas E. Patterson
Daniel J. Bussel
Klee Tuchin Bogdanoff & Stern
1801 Century Park East, 26th Fl.

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Los Angeles, CA 90067
Counsel for Appellees Pfau Cochran Vertetis Amala
PLLC and Zalkin Law Firm, P.C.
Gregory G. Garre
Eric J. Konopka
Latham & Watkins LLP
555 Eleventh St., NW, Suite 1000
Washington, DC 20004
Counsel for Amici Curiae Certain Contributing and
Participating Chartered Organization in Support of
Appellees
Adam J. Tragone
University of Pittsburgh School of Law
321 Barco Law Building
3900 Forbes Ave.
Pittsburgh, PA 15260
Evan Smola [ARGUED]
Hurley McKenna & Mertz, P.C.
20 S. Clark St. Ste. 2250
Chicago, IL 60603
Counsel for Amici Curiae Boy Scout Claimants Florian
Gorski, Estate of Harry Babcock, Douglas Kennedy,
Robert Zillox, Craig Miller, Kristofer Pyorre, Theodore
W., and Frank S. in Support of Appellees

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________________
OPINION OF THE COURT
________________
KRAUSE, Circuit Judge.
These appeals arise from the horrific history of sexual
abuse in the Boy Scouts of America’s ranks. For decades, that
abuse permeated scouting programs, ranging from single
instances of harassment to serial offenses of sexual penetration.
In recent years, more and more brave victims of this abuse have
come forward and filed lawsuits against the Boy Scouts of
America and others in the tort system to recover for the harm
they suffered, prompting Debtors Boy Scouts of America and
Delaware BSA, LLC (collectively BSA or the Debtors) in 2020
to declare bankruptcy and to commence years of negotiations
with claimants, insurers, and other interested parties towards a
global resolution for the thousands of tort claims against BSA
and related entities. That plan (the Plan), confirmed by the
Bankruptcy Court more than two years ago, among other
things, provides for the creation of a trust (the Settlement
Trust), funded by the sale of certain assets and contributions
from BSA and other nondebtors, to pay out distributions to
abuse claimants. The Plan became effective in April 2023 after
the District Court affirmed the Bankruptcy Court’s
confirmation order (the Confirmation Order).
Four groups of appellants now appeal that decision,
seeking varied forms of relief. Two of these groups, the Lujan
Claimants and the Dumas & Vaughn (D&V) Claimants,
collectively represent 140 abuse victims and ask us to reverse
the Confirmation Order and throw out BSA’s Plan in its

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entirety. That relief is warranted, they argue, because the Plan
incorporated so-called “nonconsensual third-party releases”—
releasing their claims against nondebtors without their
consent—which the Supreme Court held are impermissible
under the Bankruptcy Code last term. See Harrington v.
Purdue Pharma L.P., 603 U.S. 204 (2024). The other two
groups, the Certain Insurers and Allianz Insurers, seek
narrower relief. The former asks for the addition of language
in the Plan and Confirmation Order to make clear that their
rights and defenses under assigned insurance policies are
preserved. The latter seeks amendment to the Confirmation
Order, in essence, to ensure that they retain the rights they
would have had outside of bankruptcy to collect on their
defense costs and excess liability claims, though now drawn
from the Settlement Trust.
As explained in more detail below, we will decline the
Lujan Claimants’ and D&V Claimants’ invitation to reverse
the Confirmation Order at this late stage and will dismiss their
appeals because the Bankruptcy Code precludes us from
reaching the merits of their claims. The narrow relief advanced
by the Certain Insurers and Allianz Insurers, however, does not
trigger the same statutory bar, so we reach the merits, but with
different consequences for these two groups of appellants: The
Certain Insurers’ claims fail because the Confirmation Order
and Plan already preserve their rights and defenses under their
policies, while the Allianz Insurers are entitled to relief
because the Confirmation Order impermissibly releases their
claims under their policies.
Accordingly, we will dismiss the Lujan Claimants’ and
D&V Claimants’ appeals, affirm as to the Certain Insurers’
claims, and reverse as to the Allianz Insurers’ claims.

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I. Background
A. The Boy Scouts of America
These consolidated appeals come to us on an extensive
procedural record, but the facts that precipitated BSA’s
bankruptcy long predate its filing. Chartered by Congress in
1916 as a non-profit corporation, BSA’s charitable mission
includes preparing young people for life by instilling in them
values like trustworthiness, kindness, friendliness, and
helpfulness. It carries out this mission and delivers scouting
programs through a network of national, regional, and local
entities. BSA sits atop this structure and “develops and
disseminates the structure and content of the Scouting
program, owns and licenses intellectual property, and
establishes merit badge requirements and membership
qualifications.”1 In re Boy Scouts of Am. and Del. BSA, LLC,
650 B.R. 87, 106 (D. Del. 2023). Below BSA lie
approximately 250 Local Councils—each a distinct non-profit
organization incorporated under state law—that cover various
geographical regions throughout the country and that charter
local organizations, recruit scouts and leaders, and enforce
BSA policies. Finally, Local Councils operate in conjunction
with Chartered Organizations—often schools, religious
institutions, and civic associations—that provide facilities and
support for scouting activities.
1 BSA also wholly owns or controls seven nondebtor affiliates:
BSA Asset Management, LLC; BSA Commingled
Endowment Fund, LP; BSA Endowment Master Trust;
National Boy Scouts of America Foundation; Learning for
Life; Arrow WV, Inc.; and Atikaki Youth Ventures Inc. and
Atikokan Youth Ventures Inc.

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Since 1935, BSA had purchased insurance policies that
covered a variety of potential liabilities, including abuse
claims. Local Councils and Chartered Organizations, which
were not covered as insureds under BSA’s policies before
1971, purchased independent insurance policies. Beginning in
the 1970s, however, BSA offered the option for Local Councils
to pay a premium to be included as insureds under BSA’s
policies, which many Local Councils elected to do. And from
1975 onward, BSA included all Local Councils as insureds,
with Chartered Organizations gaining coverage in 1976.
The need for that insurance became painfully apparent
in the decades that ensued. What began as a trickle of
seemingly isolated claims in the 2000s steadily increased as the
degree and pervasiveness of the abuse came to light. Between
2017 and 2019, BSA resolved about 250 abuse claims for
approximately $150 million. Meanwhile, many states enacted
revival statutes enabling survivors to assert claims that were
previously barred by statutes of limitation, and by 2019, it
became apparent that BSA could not continue to defend
individual abuse claims on a cases-by-case basis and would
need to declare bankruptcy.
B. BSA’s Petition and the Plan
On February 18, 2020, BSA filed for bankruptcy
protection in the District of Delaware. The Bankruptcy Court
set a “bar date” of November 16, 2020, meaning all prepetition
creditors (such as abuse claimants) had to file proofs of claim
by that date to have an allowable claim. As of the bar date,
creditors had filed over 100,000 proofs of claim, of which
82,209 were unique and timely abuse claims. The Bankruptcy

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Court estimated the total value of abuse claims as between $2.4
and $3.6 billion.
To resolve this massive liability and achieve a global
resolution of abuse claims, the Bankruptcy Court appointed
mediators to facilitate discussions among the parties, and the
Debtors “engaged in near-continuous mediation with every
major constituency in the Chapter 11 Cases.” BSA Answering
Br. 17. These negotiations eventually yielded the Plan at issue
in this appeal that establishes the Settlement Trust funded with
approximately $2.48 billion in noncontingent assets
contributed by BSA and various nondebtors. The vast majority
of that funding—over $1.6 billion—derives from the proceeds
of BSA’s sale of its liability insurance policies back to a group
of its pre-petition insurers (the Settling Insurers). This
“Insurance Policy Buyback” is effectuated through a series of
individual, but materially identical, settlement agreements
between BSA and each of the Settling Insurers that provide for:
(i) the payment by the insurer of an agreed
amount on an agreed schedule to the Settlement
Trust to be used to pay Abuse Claims; (ii) the
assignment of the Local Council Insurance
Policies to the estate and the sale of the Local
Council Insurance Policies and the BSA
Insurance Policies . . . to the insurer under § 363
free and clear of all claims and interests of all
parties; and (iii) a complete release from all
parties . . . of all causes of action arising out of
their respective insurance policies and any
liability for Abuse Claims.

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In re Boy Scouts of Am. and Del. BSA, LLC, 642 B.R. 504,
562–63 (Bankr. D. Del. 2022). That third provision—
contemplating nonconsensual third-party releases—enables
the Settling Insurers to “obtain a complete release of liability
for Abuse claims on behalf of themselves, the named
insured(s) under their policies and any additional insureds
(whether specifically named or categorically identified).” Id.
at 563.
In addition to establishing the Settlement Trust, the Plan
sets forth the Trust Distribution Procedures that govern
distribution of trust assets to individual claimants. The Trust
Distribution Procedures establish four mechanisms for
distributing payments for allowed abuse claims: (a) the
Expedited Distribution election, (b) evaluation under the
Claims Matrix, (c) the Tort System Alternative, and (d) the
Independent Review Option.
Claimants who choose the Expedited Distribution
election must have submitted a timely proof of claim for
scouting-related abuse and have personally signed the proof of
claim, affirming its veracity. Upon meeting these criteria, a
claimant is entitled to a distribution from the Settlement Trust
of $3,500 as satisfaction for his claim.
The Claims Matrix election offers a more rigorous and
individualized assessment of abuse claims. To make this
election, a claimant must (1) make a Trust Claim Submission
to the Settlement Trust, which includes a completed
questionnaire signed under oath, producing all records in his
possession related to the abuse (including records indicating
monetary recoveries or expected recoveries on account of the
abuse), and agreeing to produce further records as requested by

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the Settlement Trustee; (2) consent to an interview (including
by healthcare professions) conducted by the Settlement
Trustee; and (3) consent to sworn written or oral examination.
The Settlement Trustee screens these submissions for
compliance and disallows those that do not meet these criteria.
Satisfactory submissions proceed to the second stage of
evaluation where they are screened for compliance with the
General Criteria defined in the Trust Distribution Procedures.2
Satisfaction of the General Criteria results in an Allowed
Abuse Claim, which is then run through the Claims Matrix and
Scaling Factors that assign monetary values to claims
involving particular types of abuse.3 This calculation yields a
2 The General Criteria are: (1) identification of alleged acts of
abuse; (2) identification of the abuser by name or information
that enables the Settlement Trustee to determine whether the
abuser was an employee, agent, or volunteer of a covered
entity; (3) the alleged abuse relates to scouting and a Protected
Party may “bear legal responsibility”; (4) identification of the
date of abuse directly or indirectly; and (5) identification of the
location the abuse took place.
3 As laid out in the Debtors’ disclosure statement, the Claims
Matrix divides claims into six tiers and sets the range of values
for Allowed Abuse Claims from $3,500 to $2.7 million. While
the maximum matrix values for a given tier set the ceiling for
that category of claim, the base matrix value is “merely a
starting point for the calculation” of a claim’s value. In re Boy
Scouts of Am. and Del. BSA, LLC, 642 B.R. 504, 544 (Bankr.
D. Del. 2022). The Scaling Factors determine where, within a
given Claims Matrix tier value range, a claim falls “based on
evidence regarding the BSA’s . . . historical abuse settlements,
litigation outcomes, and other evidence.” App. 20723.

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claimant’s proposed allowed claim amount which, if the
claimant is satisfied or takes no further action to contest,
becomes the amount that a claimant is entitled to receive from
the Settlement Trust. Alternatively, a claimant may ask the
Settlement Trustee to reconsider the calculation within thirty
days of receipt.
A claimant dissatisfied with the Settlement Trustee’s
initial or reconsidered proposed allowed claim amount may
elect to pursue the Tort System Alternative and have that
amount reviewed “by a court of competent jurisdiction.” In re
Boy Scouts, 642 B.R. at 544. Under this election, the amount
a claimant may receive from the Settlement Trust “is the final
judgment less any payments actually received and retained by
the [claimant], but if the claimant receives a judgment in excess
of the Maximum Matrix Value for the applicable tier, that
additional amount is subordinate in right of distribution to the
prior payment in full” of all other allowed abuse claims. Id.
Finally, a claimant may elect to pursue the Independent
Review Option, which “contemplates recoveries above the
values stated in the Claims Matrix and is designed to permit
[claimants] with higher value claims to potentially receive a
higher award and directly trigger excess insurance coverage.”
Id. Within six months of the effective date of the Plan, a
claimant could seek an individualized evaluation of his claim
“by a neutral third party (a retired judge with tort experience
on a panel maintained by the Settlement Trust)” who, after
accounting for the “relative shares of fault and the standard of
proof” under governing law, makes a settlement
recommendation to the Settlement Trustee. Id.

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The Settlement Trustee, in turn, may accept or reject the
neutral’s settlement recommendation. If the Trustee accepts
the recommendation, that amount becomes the allowed claim
amount, and the Trustee must provide notice to any applicable
non-consenting insurer.4 If the Trustee rejects the neutral’s
recommendation, the claimant may sue the Settlement Trust in
any court of competent jurisdiction to liquidate his claim. But
this option is not without risk. If the neutral recommends, and
the Trustee accepts, a settlement of zero, the claimant neither
receives a distribution from the Settlement Trust nor can he
pursue his claim in a separate action.
C. Confirmation
On September 29, 2021, the Bankruptcy Court
approved the Debtors’ disclosure statement, permitting them to
begin solicitation for the Plan. The Plan carried approval from
each of the nine classes of creditors entitled to vote on it.5 After
their initial solicitation, the Debtors continued to work with
interested parties to resolve remaining disputes. Through these
efforts, BSA secured additional insurance settlements which
resulted in greater contributions from BSA, Local Councils,
and the Settling Insurers to the Settlement Trust. The Debtors
4 If the insurer declines to provide coverage, the Settlement
Trustee may sue the insurer under the insurance policy in a
collateral proceeding.
5 Classes 1 and 2 are unimpaired and, under the Bankruptcy
Code, are conclusively deemed to accept the Plan without
being entitled to vote. See 11 U.S.C. § 1126(f). Class 10 is
fully impaired and therefore deemed to reject the Plan. See id.
§ 1126(g). The remaining nine classes of creditors enumerated
in the Plan were authorized to and did vote on the Plan.

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incorporated these post-solicitation settlements and
modifications into the Plan, submitted and disseminated
supplemental disclosures to affected creditors (those in Classes
8 and 9), and offered those creditors the opportunity to change
their votes given the modifications. Following an extension of
the voting period, Classes 8 and 9 voted to accept the Plan by
an even greater margin.
But not all class members were so solicitous. Thirty-
nine parties filed objections to the Plan’s confirmation, with
the objectors falling into two broad groups—non-settling
insurance companies and direct abuse claimants. In
commendably thorough and inclusive proceedings, the
Bankruptcy Court held a twenty-two-day confirmation trial
that featured fifteen days of testimony from twenty-six
witnesses and over 1,000 exhibits, followed by seven days of
oral argument. On July 29, 2022, that Court issued its 269-
page confirmation opinion, meticulously analyzing the
objections to the Plan and approving many of its key elements,
but declining to confirm the Plan in its entirety. See In re Boy
Scouts, 642 B.R. 504. It then proceeded to hold two more
hearings and, on September 8, 2022, issued supplemental
findings of fact and conclusions of law and entered the
Confirmation Order confirming the Plan. See In re Boy Scouts
of Am. and Del. BSA, LLC, No. 20-10343, 2022 WL 20541782
(Bankr. D. Del. Sep. 8, 2022).
D. Procedural History
On appeal, the District Court, after reviewing the Plan
and record and hearing two days of oral argument, affirmed the
Confirmation Order in its own 155-page opinion. The Plan
went effective on April 19, 2023 (the Effective Date).

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Appellants then initiated these appeals.6 After opening
briefs were filed, Appellees moved to dismiss all claims as
equitably and statutorily moot. The parties briefed these
motions, as well as the effect of the Supreme Court’s
intervening decision in Purdue, and we now consider these
issues along with the merits of these appeals.
II. Jurisdiction and Standard of Review
The District Court had jurisdiction over the appeal from
the Confirmation Order pursuant to 28 U.S.C. § 158(a). We
have jurisdiction under 28 U.S.C. § 158(d)(1) and § 1291, and
exercise “plenary review of an order from a district court sitting
as an appellate court in review of a bankruptcy court.” In re
Exide Techs., 607 F.3d 957, 961–62 (3d Cir. 2010). We thus
employ the same standard of review as the District Court,
“review[ing] the bankruptcy court’s legal determinations de
6 Appellants’ motions for a stay of the Confirmation Order
were denied by the District Court on April 11, 2023, and by
this Court just over a week later. Appellants renewed their
application for a stay of confirmation and these appeals after
the Supreme Court granted certiorari in Harrington v. Purdue
Pharma, L.P., 603 U.S. 204 (2024). We again denied those
applications, this time without prejudice to Appellants filing a
renewed motion in the District Court, which they promptly did.
Three days after the District Court denied that renewed request
on October 3, 2023, Appellants again sought a stay from this
Court, which we denied. Appellants then filed an emergency
stay application in the Supreme Court in light of its then-
pending decision in Purdue. After entering a brief
administrative stay, the Supreme Court denied Appellants’
application on February 22, 2024.

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29
novo, its factual findings for clear error and its exercise of
discretion for abuse thereof.” In re Trans World Airlines, Inc.,
145 F.3d 124, 131 (3d Cir. 1998).
III. Discussion
While Appellants raise a number of different claims,
most lie beyond our purview. We proceed below by addressing
four issues: (A) the Bankruptcy Court’s subject matter
jurisdiction; (B) statutory mootness under § 363(m) of the
Bankruptcy Code; (C) the application of equitable mootness to
these appeals; and (D) the merits of the Certain Insurers’ and
Allianz Insurers’ claims.
A. The Bankruptcy Court’s Jurisdiction
We begin, as we must, with jurisdiction. See George v.
Rushmore Serv. Ctr., LLC, 114 F.4th 226, 234 (3d Cir. 2024).
The Lujan and D&V Claimants argue the Bankruptcy Court
lacked jurisdiction over “claims against nondebtors local
councils, chartered organizations, religious orders, and insurers
. . . [because] any prepetition case against these nondebtors
cannot bind BSA and therefore cannot determine any rights,
liabilities, or course of action of BSA.” Lujan Opening Br. 11.
We agree with the District Court that, at a minimum, the
Bankruptcy Court properly exercised related-to jurisdiction
over these third-party claims.
Bankruptcy jurisdiction has four varieties: (1) cases
under the Bankruptcy Code; (2) proceedings “arising under”
the Code, meaning rights or remedies expressly provided by
the statute; (3) proceedings “arising in” a bankruptcy case,
meaning those that would not exist outside of bankruptcy; and

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(4) proceedings “related to” a bankruptcy case, often causes of
action under non-bankruptcy law. See In re Resorts Int’l, Inc.,
372 F.3d 154, 162 (3d Cir. 2004); In re Essar Steel Minn., LLC,
47 F.4th 193, 197 (3d Cir. 2022). The first three categories fall
within bankruptcy courts’ “core” statutory jurisdiction, In re
Combustion Eng’g, Inc., 391 F.3d 190, 225 (3d Cir. 2004),
which they may “hear and determine” without intervention
from the district court, 28 U.S.C. § 157(b)(1). The fourth
category, proceedings “related to” a bankruptcy case, is
generally considered “non-core,” In re Combustion Eng’g, 391
F.3d at 225, and bankruptcy courts have to “submit proposed
findings of fact and conclusions of law to the district court” for
plenary review and entry of a final judgment, 28
U.S.C. § 157(c)(1).
This case deals with proceedings “related to” a
bankruptcy case. A proceeding relates to a bankruptcy case
when “the outcome of that proceeding could conceivably have
any effect on the estate being administered in bankruptcy.”
Pacor, Inc. v. Higgins, 743 F.2d 984, 994 (3d Cir. 1984)
(emphasis omitted), abrogated on other grounds by Things
Remembered, Inc. v. Petrarca, 516 U.S. 124 (1995). We have
defined a “conceivable effect” to mean “the outcome could
alter the debtor’s rights, liabilities, options, or freedom of
action (either positively or negatively) and which in any way
impacts upon the handling and administration of the bankrupt
estate.” Id.

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Here, we address two bases for the Bankruptcy Court’s
related-to jurisdiction.7 First, shared insurance policies may
serve as a basis for related-to jurisdiction. See In re
Combustion Eng’g, 391 F.3d at 232–33. As the Bankruptcy
Court found, and as the record supports, BSA and the
nondebtor, would-be defendants shared liability insurance
coverage since at least 1976. Because these policies carry
various per-occurrence and aggregate coverage limits,
successful prosecution of Appellants’ claims would result in
“[a] dollar-for-dollar reduction of [BSA’s] available insurance
coverage.” In re Boy Scouts, 650 B.R. at 131. Thus, an effect
on the estate is likely, let alone conceivable, and that is more
than sufficient to impose the requisite “specter of direct impact
on the res of the bankrupt estate” to support related-to
jurisdiction. In re Quigley Co., 676 F.3d 45, 58 (2d Cir. 2012).
Second, related-to jurisdiction may exist where there
are “indemnity obligations between the debtor and non-debtor
that automatically result[] in indemnification liability against
the debtor.” In re Combustion Eng’g, 391 F.3d at 226; see also
In re W.R. Grace & Co., 900 F.3d 126, 139 (3d Cir. 2018). As
7 The Bankruptcy and District Courts concluded that the Lujan
and D&V Claimants’ claims had a conceivable effect on, and
thus “related to,” BSA’s estate on four alternative bases: (1)
shared insurance coverage among BSA and the nondebtors; (2)
BSA’s and Local Councils’ obligation to indemnify Chartered
Organizations; (3) an identity of interest among BSA and the
nondebtors; and (4) BSA’s residual interest in Local Council
property. Because we conclude that BSA’s shared insurance
and its indemnity obligations are sufficient to confirm the
existence of related-to jurisdiction, we have no need to address
the remaining two.

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the Bankruptcy Court found and, again, as the record supports,
BSA’s contractual and corporate relations with Local Councils
and Chartered Organizations give rise to non-contingent,
automatic indemnity obligations, including those asserted
through thousands of proofs of claim in BSA’s bankruptcy.
Appellants’ claims against Local Councils and Chartered
Organizations therefore conceivably affect the bankruptcy
estate, and the Bankruptcy Court properly exercised related-to
jurisdiction on that basis.
True, the Bankruptcy Court did not submit proposed
findings of fact and conclusions of law to the District Court for
final determination. See 28 U.S.C. § 157(c)(1). But doing so
is not necessary where, as here, a bankruptcy court exercises
its related-to jurisdiction as part of the plan confirmation
process. See In re Millennium Lab Holdings II, LLC, 945 F.3d
126, 133 (3d Cir. 2019), abrogated on other grounds by
Harrington v. Purdue Pharma, L.P., 603 U.S. 204 (2024). As
we have explained in applying Stern v. Marshall, 564 U.S. 462
(2011), in a similar scenario in In re Millennium, when a
bankruptcy court “resolves a matter that is integral to the
restructuring of the debtor-creditor relationship,” it may
constitutionally resolve third-party claims. In re Millennium,
945 F.3d at 135. And implicit in that holding is the recognition
that bankruptcy courts have statutory authorization to finally
determine third-party claims over which they have related-to
jurisdiction during the plan confirmation process.
In short, because the Lujan and D&V Claimants’ claims
against nondebtors have a conceivable effect on BSA’s estate,
the Bankruptcy Court properly exercised related-to jurisdiction
over those claims. And because the Bankruptcy Court resolved
those claims in the context of confirming the Plan, it did not

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33
need to submit proposed findings of fact and conclusions of
law to the District Court.
B. Statutory Mootness
Having concluded the Bankruptcy Court properly
exercised jurisdiction, we turn to Appellees’ first argument for
dismissal of these appeals—that they are “statutorily moot”
under § 363(m) of the Bankruptcy Code. Importantly, not only
is statutory mootness the primary argument the Settling
Insurers advance on appeal—and one the Debtors join—but it
is a protection for which the Bankruptcy Code expressly
provides. Thus, we decline to resort to the judge-made doctrine
of equitable mootness before evaluating these appeals under
the statutory mootness provision contained in the Bankruptcy
Code. Cf. Pearson v. Sec’y Dep’t of Corr., 775 F.3d 598, 603–
04 (3d Cir. 2015) (considering statutory tolling before
equitable tolling and concluding that, where statutory tolling
disposed of the issue, the court “need not address” the judge-
made equitable doctrine).
No doubt, that statutory bar to relief on appeal is
applicable in limited circumstances and, as we caution below,
is constrained by explicit statutory criteria and the careful
scrutiny of the reviewing judge. See infra Section III.B.2. But
even so, we agree with Appellees that it applies here, and the
relief the Lujan Claimants and D&V Claimants seek is
therefore precluded.
Below, we address, first, the mechanics of § 363(m)
and, second, the statute’s application to these appeals and the
Lujan and D&V Claimants’ arguments that § 363(m) does not
bar the relief they request.

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1. Section 363(m)’s Mechanics
We and our sister circuits have referred to § 363(m)’s
bar as “statutory mootness” since it imposes “a constraint . . .
on our capacity to fashion relief.” In re Energy Future
Holdings Corp., 949 F.3d 806, 820 (3d Cir. 2020). That
subsection provides:
The reversal or modification on appeal of an
authorization under subsection (b) or (c) of this
section of a sale or lease of property does not
affect the validity of a sale or lease under such
authorization to an entity that purchased or
leased such property in good faith, whether or
not such entity knew of the pendency of the
appeal, unless such authorization and such sale
or lease were stayed pending appeal.
11 U.S.C. § 363(m).
In other words, when confronted with a challenge to a
§ 363(b) sale, the reviewing court must first “ascertain[] that
the appeal is from an authorization of a sale, that the purchase
was made in good faith, and that the sale was not stayed.” In
re Energy Future Holdings, 949 F.3d at 821. If those
circumstances are met, the court then must determine “whether
a remedy can be fashioned that will not affect the validity of
the sale.” Id. (quoting Krebs Chrysler-Plymouth, Inc. v. Valley
Motors, Inc., 141 F.3d 490, 498–99 (3d Cir. 1998)). That
determination requires close scrutiny. If the remedy does not
affect the sale’s validity, the court may entertain the appeal.
But if it would necessarily affect the sale’s validity, the relief
is unavailable, so the appeal must be dismissed. The answer is

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35
easy where the requested relief “would materially increase or
decrease the purchase price,” but other remedies, too, may fall
into that category with “careful study[,] depending on the
nature of the claim and the type of relief sought.” Id.
In restricting appeals for this narrow category of
appeals, Congress chose “to promote the policy of . . . finality.”
Krebs Chrysler-Plymouth, 141 F.3d at 500. And this policy
serves an important role in the bankruptcy process. Debtors
often enter bankruptcy in dire financial straits with the value of
their assets depreciating rapidly—the proverbial “melting ice
cube.” Sometimes, in order to avoid a liquidation or risk
further dissipation and losses to the estate, “it is more
advantageous for the debtor to begin to sell as many assets as
quickly as possible in order to [e]nsure that the assets do not
lose value.” Fla. Dep’t of Revenue v. Piccadilly Cafeterias,
Inc., 554 U.S. 33, 57 (2008) (Breyer, J., dissenting) (quotation
omitted). Section 363(b) permits just that: a debtor may, with
approval from the bankruptcy court, “use, sell, or lease . . .
property of the estate” outside the ordinary course of business.
11 U.S.C. § 363(b)(1).
But without assurance that a § 363(b) sale is final,
potential purchasers of estate assets would be chilled from
dealing with the debtor, causing assets to languish idly while
the bankruptcy progresses, all the while hemorrhaging value
and undermining the very purpose § 363(b) aims to serve.
Section 363(m) provides the protection that § 363(b) sales
require. Indeed, absent its protections, “purchasers of
bankruptcy estate assets could be dragged into endless rounds
of litigation to determine who has what rights in the property,”
which not only would disrupt the efficient flow of commerce,
“but would also substantially reduce the value of the estate.”

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36
In re Rare Earth Mins., 445 F.3d 359, 363 (4th Cir. 2006)
(quotation omitted). By sheltering unstayed sale
authorizations to good-faith purchasers from “reversal or
modification on appeal,” § 363(m) serves Congress’s goals of
“attract[ing] investors and help[ing] effectuate debtor
rehabilitation,” Cinicola v. Scharffenberger, 248 F.3d 110, 122
(3d Cir. 2001)—goals we will not lightly discard.
To be sure, “while § 363(m) aims to make sales of estate
property final and inject predictability into the sale process . . .
it does [not do] so at all costs.” In re ICL Holding Co., Inc.,
802 F.3d 547, 554 (3d Cir. 2015). By its terms, § 363(m) only
prohibits “reversal or modification on appeal” of a § 363(b)
“authorization.” It does not prohibit all appeals, but only those
in which the authorization was not “stayed pending appeal.”
And it does not prohibit the appeal of challenges to all sales
and leases, but “only those challenges that would claw back the
sale from a good-faith purchaser.” Id. Plus, it bars only those
challenges where the relief sought would affect the “validity of
the sale.” In re Energy Future Holdings, 949 F.3d at 821. So
in the normal course, § 363(m) permits challenges “that are so
divorced from the overall transaction that the challenged
provision would have affected none of the considerations on
which the purchaser relied” and to “collateral issues not
implicating a central or integral element of a sale.” In re
Pursuit Cap. Mgmt., LLC, 874 F.3d 124, 139 (3d Cir. 2017)
(quoting In re Westpoint Stevens, Inc., 600 F.3d 231, 249 (2d
Cir. 2010)).
In short, § 363(m) precludes judicial review of a narrow
and well-defined category of cases, so we turn now to whether
this is one of them.

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2. Application to These Appeals
We can quickly dispense with the application of
§ 363(m) to the Certain Insurers and Allianz Insurers, and so
address those appeals before turning to the appeals of the Lujan
and D&V Claimants.
a. The Certain Insurers and Allianz
Insurers
The Certain Insurers and Allianz Insurers each seek a
limited form of relief sufficiently collateral to the Insurance
Policy Buyback and, therefore, their appeals avoid triggering
§ 363(m).
The Certain Insurers seek what they characterize as
“minimal, but critical, modifications to the Plan to ensure that
their rights are preserved” under their insurance policies
assigned to the Settlement Trust. Certain Insurers Opening Br.
7. These changes include (1) elimination of language in the
Plan that makes the Certain Insurers’ rights “subject to the
terms of the Plan and the Confirmation Order”; (2) inclusion
of language in the Plan requiring the Settlement Trustee to
balance the rights of the Certain Insurers along with other
interested parties when administering the Settlement Trust; and
(3) inclusion of a provision requiring the Settlement Trustee to
“consider any further limitation on Abuse Claimants’ recovery
in the tort system” when determining a claimant’s entitlement
to compensation. Id. at 7–8.
None of these requested changes to the Plan implicate
the terms of the Insurance Policy Buyback; instead, they
reduce primarily to modifications ensuring that the Certain

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38
Insurers’ interests are protected and considered in the
administration of the Settlement Trust. So rather than seeking
relief “implicating a central or integral element of a sale,” the
Certain Insurers’ requested relief is sufficiently “divorced from
the overall transaction” such that, if granted, it would “affect[]
none of the considerations on which the purchaser relied.” In
re Pursuit Cap. Mgmt., 874 F.3d at 139. Accordingly,
§ 363(m) poses no barrier to our consideration of the merits of
their appeal.
The same goes for the Allianz Insurers. Like the Certain
Insurers, the Allianz Insurers propose targeted changes that
implicate neither the terms nor the validity of the Insurance
Policy Buyback. Specifically, they contend that the
Confirmation Order’s “judgment reduction clause”
impermissibly releases contribution and indemnity claims they
would otherwise have against the Settling Insurers. As a fix,
they propose modifications to the Confirmation Order to
require the Settlement Trustee to pay these released claims to
the extent they accrue. This change does not implicate any
provision of the Insurance Policy Buyback—indeed, the
Allianz Insurers’ argument takes as a given the existence of the
Settlement Trust, funded in part by the proceeds of the
Insurance Policy Buyback and the release of their claims
against the Settling Insurers. And in proposing that the
Settlement Trust, rather than the Settling Insurers, cover the
cost of satisfying their released claims, the Allianz Insurers
have not asked for relief that “would materially increase . . .
the purchase price” paid by the Settling Insurers. In re Energy
Future Holdings, 949 F.3d at 821; cf. In re ICL Holding Co.,
802 F.3d at 554 (concluding that reallocation of escrowed
funds to satisfy administrative expenses was not barred by

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39
§ 363(m)). For these reasons, the Allianz Insurers’ appeal
likewise does not implicate § 363(m).
b. The Lujan and D&V Claimants
The Lujan Claimants and D&V Claimants, however, are
differently situated, and we have little difficulty concluding
that the relief they seek would affect the validity of the
Insurance Policy Buyback authorized by the Confirmation
Order. These Claimants have steadfastly urged us to reverse
the Confirmation Order and vacate the Plan in its entirety. But
the Confirmation Order contains the authorization for the sale
of BSA’s insurance policies. See In re Boy Scouts, 2022 WL
20541782, at *10–11. Granting these Claimants’ requested
relief would reverse on appeal an authorization made pursuant
to § 363(b)—the very result § 363(m) prohibits.
Our concurring colleague disagrees, asserting that the
buyback of some of the Settling Insurers’ policies has yet to
occur because it is “expressly condition[ed]” on the
Confirmation Order becoming a “Final Order” as defined in
the settlement agreements. Concurring Op. 12. But this
contention is doubly mistaken.
First, as counsel for the Settling Insurers represented to
us at oral argument, and as is borne out in the Plan, the
Insurance Policy Buyback was completed on the Effective
Date, meaning “the policies have been sold.” Oral Arg. Tr.
76:6; see also App. 975 (“Notwithstanding anything to the
contrary and for the avoidance of doubt, the Abuse Insurance
Policies [including Hartford’s and Zurich’s policies] shall be
sold by the Debtors to the applicable Settling Insurance
Companies free and clear of all liens, claims, encumbrances,

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40
interests or other rights on the Effective Date on the terms and
as provided in the applicable Insurance Settlement
Agreement.”).
Second, even if that were not the case, § 363(m) speaks
in terms of unstayed authorizations under § 363(b)—it does
not include an inchoate requirement that a § 363(b) sale be
consummated or otherwise effectuated. See In re Rickel Home
Ctrs., Inc., 209 F.3d 291, 298 (3d Cir. 2000) (recognizing that
for § 363(m) to apply, “the underlying sale or lease must not
have been stayed pending appeal” and “reversing or modifying
the authorization to sell or lease would affect the validity of the
sale or lease,” and holding that “[appellant]’s appeal on this
point, absent a stay, is moot” (emphasis added)); Krebs
Chrysler-Plymouth, 141 F.3d at 493, 500 (holding appeal from
§ 363(b) sale was moot where purchaser had paid only 10% of
purchase price “because [appellant] did not receive a stay of
the sale pending appeal”); Pittsburgh Food & Beverage, Inc.
v. Ranallo, 112 F.3d 645, 651 (3d Cir. 1997) (holding that
§ 363(m) barred appeal “because of [appellant]’s inability to
obtain a stay of the bankruptcy court’s order approving the
sale” (emphasis added)).
As we have explained, § 363(m) kicks in when (1) “the
appeal is from an authorization of a sale [under § 363(b)]”; (2)
“the purchase was made in good faith”; and (3) “the sale was
not stayed.” In re Energy Future Holdings, 949 F.3d at 820.
Those conditions are met here: (1) the Confirmation Order
unambiguously authorizes “[t]he sale of the [Settling Insurers’
policies] . . . pursuant to section[] 363,” In re Boy Scouts, 2022
WL 20541782, at *10; (2) the Bankruptcy Court found that the
Settling Insurers “are each good faith purchasers for value
within the meaning of section 363(m),” id. at *8; and (3) the

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Confirmation Order—including the Insurance Policy
Buyback—was not stayed. So § 363(m) applies to this
§ 363(b) authorization.
As for the concurrence’s contentions that “[s]ection
363(m) clearly contemplates not only an authorized sale, but a
completed sale” and “an appeal cannot affect the validity of a
sale that has not happened,” Concurring Op. 14, both our
precedent and common sense disagree. As explained above,
we have identified three conditions to § 363(m)’s application,
and all are satisfied here. See In re Energy Future Holdings,
949 F.3d at 820. And just as the fact that ongoing performance
does not negate the existence of a contract, the fact that every
last cent has not been handed over does not mean a sale has not
occurred. So just as a party’s breach would affect the
contractual relationship, invalidation of the releases at this late
stage would affect the validity of the sale to which BSA and
the Settling Insurers agreed. By any measure, § 363(m) applies
here.
In an effort to avoid this conclusion, the Claimants raise
a bevy of arguments, but none is persuasive.8 First, they argue
8 At the outset, the Lujan and D&V Claimants assert that
because they advance constitutional claims—namely due
process claims—we must reach the merits before passing on
statutory mootness. But “we cannot consider [those claims] if
the appeal . . . is moot under 11 U.S.C. § 363(m).” In re Pursuit
Cap. Mgmt., LLC, 874 F.3d 124, 133 (3d Cir. 2017). And as
we have previously held, § 363(m) does not except certain
types of claims from its appellate moratorium—even
constitutional ones. In re Energy Future Holdings Corp., 949

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that, because the Insurance Policy Buyback is not a sale
“outside a plan of reorganization,” it is not a § 363(b) sale at
all, making § 363(m) inapplicable by its own terms. Lujan
Claimants Opp. Mot. to Dismiss 5; see also D&V Claimants
Opp. Mot. to Dismiss 21. But we dispatched this argument
years ago. In Cinicola v. Scharffenberger, we held that a
second-in-time order authorizing the assignment of certain
contracts that was “inextricably intertwined with” a prior
authorization for the sale of assets under § 363(b) fell within
the ambit of § 363(m) and, therefore, a challenge to the contract
assignment was statutorily moot. 248 F.3d at 126. And in In
re Energy Future Holdings, we held that a confirmation order
that “authorized and directed” the consummation of a
previously approved asset sale (styled as a “merger” and
conditioned upon the eventual confirmation of a reorganization
plan) qualified as an authorization of a sale for purposes of
§ 363(m).9 949 F.3d at 819–20; accord In re Fieldwood
F.3d 806, 818 (3d Cir. 2020) (rejecting argument “that there is
a due process exception to § 363(m)”).
9 The concurrence attempts to distinguish Cinicola and In re
Energy Future Holdings as cases involving “a separate
Bankruptcy Court order . . . [that] preliminarily approved a
§ 363 sale, and the confirmation order had the effect” of
making the sale final. Concurring Op. 6. True, those cases
involved separate orders, but we explicitly rejected the
suggestion that this fact was relevant to the § 363(m) analysis.
Instead, we stated in Cinicola that successive orders “were
inextricably intertwined,” meaning the second-in-time order
did not “represent[] an independent act” and an appeal from it
affected the validity of the § 363(b) sale contained in the first
order. Cinicola v. Scharffenberger, 248 F.3d 110, 126 (3d Cir.

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43
Energy LLC, 93 F.4th 817, 825 (5th Cir. 2024) (applying
§ 363(m) to sale authorized by confirmation order); In re Made
in Detroit, Inc., 414 F.3d 576, 582–83 (6th Cir. 2005) (same).
Here, the Confirmation Order, which authorized the sale of
BSA’s insurance policies, equally serves as an “authorization
. . . of a sale” under § 363(m).10
Second, the Lujan Claimants argue that the Settling
Insurers are not good faith purchasers because they purchased
BSA’s policies despite abuse claimants asserting rights in
those policies and with the knowledge that the Lujan Claimants
intended to challenge the Plan on appeal. But this argument
ignores both the text of § 363(m) and the Bankruptcy Court’s
factual findings. Section 363(m) extends protection to
purchasers “whether or not such entity knew of the pendency
of [an] appeal” challenging the sale authorization. In other
words, § 363(m) contemplates that sale authorizations under §
363(b) may be subject to dispute and nonetheless insulates
2001). And in In re Energy Future Holdings, we emphatically
“reject[ed] Appellants’ argument that they are not appealing
the ‘authorization . . . of a sale’ for purposes of § 363(m)”
simply because the bankruptcy court there entered two orders
instead of one. 949 F.3d at 820.
10 At argument, the D&V Claimants suggested that the
Insurance Policy Buyback is not a true § 363(b) sale because
the Settling Insurers are not a “third-party,” but rather insiders
who stood to gain from the sale by receiving releases under the
Plan. Oral Arg. Tr. 16:10–11. But this contention cannot be
squared with the text of § 363(m), which “contains no
exception for sales to creditors, or other parties to the
bankruptcy proceedings.” Krebs Chrysler-Plymouth, Inc. v.
Valley Motors, Inc., 141 F.3d 490, 500 (3d Cir. 1998).

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those authorizations from reversal or modification on appeal.
And that result aligns perfectly with the policy goal of §
363(m): to extinguish “the risk of litigation [that] would chill
prospective bidders or push them to ‘demand a steep
discount.’” In re ICL Holding Co., 802 F.3d at 554 (quoting
In re River West Plaza-Chi., LLC, 664 F.3d 668, 671 (7th Cir.
2011)).
In this case, the Bankruptcy Court unequivocally
determined that “[t]he Settling Insurance Companies are each
good faith purchasers for value within the meaning of section
363(m) of the Bankruptcy Code.” In re Boy Scouts, 2022 WL
20541782, at *8. And, for the reasons above, we agree with
that determination.11
Third, Appellants contend that they do not seek to upset
the Insurance Policy Buyback, but rather only take issue with
the nonconsensual third-party releases contained in the Plan.
But where, as here, the releases form a portion of the
consideration for the Insurance Policy Buyback, that is a
distinction without a difference. Under the Plan, the Settling
Insurers paid over $1.6 billion in exchange for the return of
their insurance policies from BSA, with liability cabined by the
third-party releases. So without the releases, the Settling
Insurers would receive less than they bargained for in exchange
for their cash contribution to the Settlement Trust, which
“would materially increase . . . the purchase price” and, thus,
11 Thus, this case differs from those cited by the concurrence
where the court did not make a good-faith determination for
purposes of § 363(m). See Miami Ctr. Ltd. P’ship v. Bank of
N.Y., 838 F.2d 1547, 1550–51 (11th Cir. 1988).

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“would plainly affect the validity of the sale.” In re Energy
Future Holdings, 949 F.3d at 821.
Perhaps recognizing the import of the relief they seek—
relief that would send BSA and over 82,000 abuse claimants
back to square one and would almost certainly unleash years
of litigation in the wake of the vacated Plan—the Lujan and
D&V Claimants suggest that more limited remedies are
available that “do[] not touch the insurance sale or dismantle
the plan.” D&V Claimants Opp. Mot. to Dismiss 32. They
offer two by way of “example.” Id. But the Bankruptcy Code
permits neither.
The proposal that “the third parties benefiting from the
releases could pay more money,” id., is the quintessential
example of relief that “would materially increase . . . the
purchase price.” In re Energy Future Holdings, 949 F.3d at
821. And permitting the Lujan and D&V Claimants to “opt out
of the nonconsensual releases,” D&V Claimants Opp. Mot. to
Dismiss 32, effects the same result: the Settling Insurers would
receive less in exchange for their cash contribution than they
bargained for under the terms of the Insurance Policy Buyback.
BSA and the Settling Insurers struck a deal for a global
resolution, and blue-penciling a post-confirmation opt-out
structure—even for a relatively small number of claimants—
would fundamentally undermine that bargain. Allowing some
claimants, but not others, to circumvent the releases and pursue
claims against previously released parties would also violate
the Bankruptcy Code’s requirement that a plan “provide the
same treatment for each claim or interest of a particular class”
absent consent from a claimholder to less favorable treatment.
11 U.S.C. § 1123(a)(4). At bottom, the Lujan and D&V
Claimants have not proposed relief that the Code permits.

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At the same time the Claimants offer these two
“examples” of limited relief, they seek to shift that onus to the
Appellees, asserting “[i]t is not Appellants’ burden to propose
all available relief.” D&V Claimants Opp. Mot. to Dismiss 32.
But it is. As the challengers to an unstayed § 363(b) sale
“seeking to avert § 363(m)’s bar,” Appellants bear the burden
of “demonstrat[ing] that the relief affects only ‘collateral issues
not implicating a central or integral element of a sale.’” In re
Energy Future Holdings, 949 F.3d at 821 (quoting In re
Pursuit Cap. Mgmt., 874 F.3d at 139). Because they fail to
clear that bar, we cannot grant effective relief.
Fourth, in a brief passage near the end of their
opposition to the Settling Insurers’ motion to dismiss, the
Lujan Claimants contend that even if the releases of some of
their claims were integral to the Insurance Policy Buyback,
their other claims against “Limited Protected Parties,”
particularly Chartered Organizations like the Roman Catholic
Entities (who were not insured under BSA’s pre-1975
insurance policies), do not implicate the sale and thus can be
pursued on appeal. But this final gesture at more limited relief
also falls short for both pre- and post-1976 abuse claims. That
is because the Plan provides releases for Limited Protected
Parties for abuse claims after 1975 and for pre-1976 claims
against Limited Protected Parties covered by policies provided
by a Settling Insurer. And for pre-1976 claims against Limited
Protected Parties that were not then insured with the Settling
Insurers, the Plan and Confirmation Order neither release those
claims nor enjoin their prosecution. See In re Boy Scouts, 2022
WL 20541782, at *28.
Additionally, throughout their briefs, the Lujan
Claimants and D&V Claimants argue that embracing

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Appellees’ statutory mootness argument here would
effectively “immuniz[e] the substantive terms of a plan from
appellate review” anytime a plan involves a § 363(b) sale.
D&V Claimants Opp. Mot. to Dismiss 20. But our holding
does no such thing, and we take this opportunity to emphasize
the narrowness of our decision in two respects: the limited
scope of § 363(m) and the boundaries of so-called “sub rosa”
plans that fall beyond it.
As for § 363(m) itself, the statute prohibits the reversal
or modification of § 363(b) sales; it does not moot appellate
review of, and reversal or modification to, entire
reorganization plans. Our decision does not read § 363(m) to
immunize from appellate review all facets of a plan whenever
a § 363(b) sale is involved. Put differently, a challenge to a
§ 363(b) sale that is “collateral” to or would not otherwise
“affect the validity of the sale” falls outside the ambit of
§ 363(m), In re Energy Future Holdings, 949 F.3d at 821, and
given the breadth of issues a reorganization plan may resolve
that do not necessarily implicate the terms of a § 363(b) sale,
see 11 U.S.C. § 1123(a)–(b), the vast majority of challenges,
no doubt, will fall into this category.12
12 We need not speculate as to what aspects of hypothetical
plans may or may not be immunized from reversal or
modification on appeal. No doubt, those who practice in
bankruptcy court “are creative,” Oral Arg. Tr. 78:22, so any
attempt to predict what transactions and plan provisions
bankruptcy practitioners might engineer next would surely be
a gross underestimation. Today, it is enough to conclude that
in the context of this Plan, the nonconsensual third-party
releases challenged by the Lujan and D&V Claimants go to the

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Nor does our application of § 363(m) to this § 363(b)
sale countenance the use of § 363(b) during the course of
bankruptcy proceedings to effectuate a sub rosa plan by
“dictat[ing] the terms of a plan.” 3 Collier on Bankruptcy
¶ 363.02[3] (16th ed. 2024). Our Court has not had occasion
to opine on or define the boundaries of a sub rosa plan, but
some of our sister circuits have done so. In In re Braniff
Airways, Inc., the Fifth Circuit reversed a § 363(b) sale
authorization that the bankruptcy court approved before a plan
had been proposed or a disclosure statement approved, and that
included, as part of the sale agreement, terms that required the
future plan to allocate certain assets to certain parties, required
creditors to vote portions of their deficiency claims in favor of
a future plan, and “provided for the release of claims by all
parties against [the debtor], its secured creditors and its officers
and directors.” 700 F.2d 935, 940 (5th Cir. 1983). The court
concluded that the putative § 363(b) sale was “in fact a
reorganization” and held that a party “should not be able to
short circuit the requirements of Chapter 11 for confirmation
of a reorganization plan by establishing the terms of the
plan sub rosa in connection with a sale of assets.” Id. Instead,
when a debtor “attempts to specify the terms whereby a
reorganization plan is to be adopted,” it “must scale the hurdles
erected in Chapter 11.” Id. The Second Circuit reached a
similar conclusion in In re Lionel Corp., 722 F.2d 1063 (2d
Cir. 1983). There, the court rejected a pre-plan § 363(b) sale
of the debtor’s most important asset that effectively
“swallow[ed] up Chapter 11’s safeguards.” Id. at 1069; cf.
Czyzewski v. Jevic Holding Corp., 580 U.S. 451, 468 (2017)
(holding that the Bankruptcy Code does not permit structured
heart of the Bankruptcy Court’s § 363(b) authorization, so
§ 363(m) prevents us from disrupting them on appeal.

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dismissals, which deviate from the absolute priority rule and
“circumvent the Code’s procedural safeguards”).
The bankruptcy and district courts of this Circuit have
also acknowledged and applied the doctrine in examining sales
under § 363(b), authorizations for debtor-in-possession
financing under § 364(d), and settlements under Bankruptcy
Rule 9019 to ensure they do not impermissibly dictate the
terms of eventual reorganization plans or bypass the Code’s
procedural safeguards. See, e.g., In re Shubh Hotels
Pittsburgh, LLC, 439 B.R. 637, 644–45 (Bankr. W.D. Pa.
2010); In re Summit Global Logistics, Inc., No. 08-11566,
2008 WL 819934, at *13–14 (Bankr. D.N.J. Mar. 26, 2008); In
re Capmark Fin. Grp. Inc., 438 B.R. 471, 513–14 (Bankr. D.
Del. 2010).
We endorse this practice and join the Fifth and Second
Circuits in applying the doctrine where warranted. No doubt,
differentiating a permissible use of § 363(b) from an invalid
one often requires consideration of the substance of proposed
transactions. But judges already must conduct similar inquiries
in a variety of other contexts,13 and we are confident that
bankruptcy and district court judges—and ultimately this
13 See, e.g., In re Hertz Corp., 120 F.4th 1181, 1196 (3d Cir.
2024) (considering whether make-whole premiums are “the
economic equivalent of interest” for purposes of claim
allowance under 11 U.S.C. § 502(b)(2)); In re Pillowtex, Inc.,
349 F.3d 711, 719 (3d Cir. 2003) (“[C]ourts are to consider the
economic reality of the transaction in order to determine, based
on the particular facts of the case, whether the transaction is
more fairly characterized as a lease or a secured financing
arrangement.”).

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50
Court14—are eminently capable of policing the bounds of
permissible § 363(b) sales and seeing cleverly disguised
transactions for what they are. Debtors and powerful creditors
do not qualify as good faith purchasers where they seek to
“maximize [their] leverage,” In re Hertz Corp., 120 F.4th
1181, 1205 (3d Cir. 2024), by dictating the terms of Chapter
11 plans up front without “scal[ing] the hurdles erected” by the
Bankruptcy Code, In re Braniff Airways, 700 F.2d at 940.
Indeed, the good-faith determination, critically, “prevents a
debtor-in-possession or trustee from effectively abrogating the
creditor protections of Chapter 11.” In re Abbotts Dairies of
Pa., Inc., 788 F.2d 143, 150 n.5 (3d Cir. 1986). Nor are we
convinced that an intentional attempt to transact by “means
forbidden by law” constitutes good faith by a purchaser.15 Id.
at 150 (quoting 11 U.S.C. § 1129(a)(3)).
14 When reviewing challenges to § 363(b) authorizations, “we
are first required to ask whether the purchaser at the sale
‘purchased . . . [the] property in good faith.’” In re Pursuit
Cap. Mgmt., 874 F.3d at 135 (alteration and omission in
original) (quoting In re Abbotts Dairies of Pa., Inc., 788 F.2d
143, 147 (3d Cir. 1986)). We review a bankruptcy court’s
determination of a purchaser’s good faith under a mixed
standard of review, exercising plenary review of the legal
standard applied, but reviewing findings of fact for clear error.
Id. Therefore, where an appellant can demonstrate that a
bankruptcy court erroneously concluded that the record facts
are sufficient to establish good faith, or those factual findings
are clearly erroneous, § 363(m) poses no barrier to appellate
review of the merits of a § 363(b) authorization.
15 Although the good-faith requirement of § 363(m) “mirrors”
that in § 1129, In re Abbotts Dairies, 788 F.2d at 150, there are

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This case raises none of those concerns.16 Here, the
Insurance Policy Buyback was included in the Plan and subject
to all of Chapter 11’s procedural protections afforded to
creditors: The Insurance Policy Buyback was included in the
important distinctions. The § 1129 good-faith inquiry does not
look to the subjective intent of the debtor. See In re
Combustion Eng’g, Inc., 391 F.3d 190, 247 (3d Cir. 2004); cf.
In re SGL Carbon Corp., 200 F.3d 154, 165 (3d Cir.
1999). But the good-faith inquiry under 363(m) looks for
“defects which would in equity affect the validity of any
private transaction,” which may include consideration of
intent. In re Abbotts Dairies, 788 F.2d at 148 (quoting In re
Cada Invs., 664 F.2d 1158, 1162 (9th Cir. 1981)); see also In
re Gucci, 126 F.3d 380, 390–91 (2d Cir. 1997).
16 Courts have crafted various standards to determine what
constitutes a sub rosa plan. See, e.g., In re Iridium Operating
LLC, 478 F.3d 452, 466 (2d Cir. 2007); In re Cajun Elec.
Power Co-op., Inc., 119 F.3d 349, 354–55 (5th Cir. 1997); see
also In re Latam Airlines Grp. S.A., 620 B.R. 722, 813 (Bankr.
S.D.N.Y. 2020); In re Capmark Fin. Grp. Inc., 438 B.R. 471,
513 (Bankr. D. Del. 2010); In re Tower Auto. Inc., 241 F.R.D.
162, 168–69 (S.D.N.Y. 2006). We have no occasion here to
endorse any of these standards or articulate one of our own.
Today, it is enough to recognize the sub rosa doctrine as an
inherent limitation to authorizations under § 363(b). At the
same time, however, our holding should not be taken to cast
doubt on the use of § 363(b) to conduct sales of all or
substantially all of a debtor’s assets—often accomplished
through auctions using bidding procedures and stalking-horse
bidders approved by the bankruptcy court—where doing so
does not effectively dictate the terms of an eventual
reorganization plan.

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52
Debtors’ solicitation and supplemental disclosure statements
and subject to objection at the confirmation hearing. All
creditors entitled to vote on the Plan—including the creditors
in Classes 8 and 9, comprising direct and indirect abuse
claimants—had adequate notice that the Plan, if confirmed,
would authorize the Insurance Policy Buyback. BSA’s
creditors chose to vote in favor of the Plan anyway, including
the class of creditors to which the Lujan and D&V Claimants
belong.17 After thirty-nine parties raised objections to the Plan,
the Bankruptcy Court held a twenty-two-day-long
confirmation hearing—devoting sixteen days to receiving
evidence, consisting of testimony from twenty-six witnesses
and over 1,000 exhibits, and six days to oral argument—before
issuing a 269-page confirmation opinion, diligently stepping
through § 1129’s confirmation requirements and approving
much, but not all, of the Debtors’ Plan. The Bankruptcy Court
then held two more hearings before issuing supplemental
findings of fact and conclusions of law and the Confirmation
Order confirming the Plan.
This abundance of process and conformity with the
Code distinguishes this case from those where a debtor’s use
17 The plan the Debtors originally solicited won support from
every class of creditors entitled to vote on it, including Classes
8 and 9, which approved the plan with 73.57% and 69.57% of
creditors’ votes, respectively. Following the initial solicitation,
BSA amended the Plan—primarily in the form of additional
insurance settlements—and offered affected creditors, i.e.,
direct and indirect abuse claimants, the opportunity to change
their votes. The revised Plan won even greater support, with
85.72% and 82.41% of ballots from Classes 8 and 9,
respectively, voting in favor of the Plan.

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53
of § 363(b) constitutes a sub rosa plan.18 A debtor improperly
invokes § 363(b) where it attempts to evade the Code’s creditor
18 Remarkably, the concurrence asserts that including a
§ 363(b) sale “as part of a globally-negotiated plan” “deprives
the sale of any real scrutiny.” Concurring Op. 8. In reality, the
opposite is true. To approve a sale under § 363(b), courts
require only that the debtor exact its sound business judgment
in good faith. See, e.g., In re Blitz U.S.A. Inc., 475 B.R. 209,
215 (Bankr. D. Del. 2012). To confirm a consensual
reorganization plan, on the other hand, the debtor must carry
its burden of satisfying § 1129(a)’s sixteen statutory
requirements by a preponderance of evidence. See, e.g., In re
Armstrong World Indus., Inc., 348 B.R. 111, 120 (D. Del.
2006); cf. Grogan v. Garner, 498 U.S. 279, 286 (1991). And
those requirements increase when a debtor seeks to “cram
down” a plan over the objection of a nonconsenting impaired
class. See 11 U.S.C. § 1129(b). The concurrence nonetheless
warns that “[s]o long as Chapter 11’s procedural requirements
are met, substantively controversial, or even unlawful, plan
provisions (like non-consensual third-party releases) can evade
appellate review.” Concurring Op. 7. But such a distortion of
the plan-confirmation process depends on dismissing the
Code’s confirmation requirements as mere formalities. Far
from a set of simple “procedural requirements,” we have
described § 1129’s confirmation criteria as “critical,” John
Hancock Mut. Life Ins. Co. v. Route 37 Bus. Park Assocs., 987
F.2d 154, 158 (3d Cir. 1993), and “an unambiguous check on
a debtor’s power” over the contents of a plan, In re Fed.-Mogul
Glob. Inc., 684 F.3d 355, 371 n.23 (3d Cir. 2012). And we
have no doubt that our colleagues on the bankruptcy courts
exercise great care in evaluating plans’ conformity to the

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54
protections, effectively “short circuit[ing] the requirements of
Chapter 11 for confirmation of a reorganization plan.” In re
Braniff Airways, 700 F.2d at 940. Here, rather than attempting
to skirt those protections, the Debtors faced them head-on and
subjected the Insurance Policy Buyback to the Code’s stringent
confirmation requirements.
* * *
In sum, the Settling Insurers qualify as good-faith
purchasers, and the purported more-limited relief proposed by
the Lujan and D&V Claimants would strike at the heart of the
Insurance Policy Buyback. Because § 363(m) bars us from
granting such relief, we will dismiss their appeals on that
basis.19 But as the Certain Insurers’ and Allianz Insurers’
Code’s requirements and holding debtors to their burden of
proof. Cf. Bullard v. Blue Hills Bank, 575 U.S. 496, 507 (2015)
(“[T]he [imperfect] appellate process . . . is made tolerable in
part by our confidence that bankruptcy courts, like trial courts
in ordinary litigation, rule correctly most of the time.”). Thus,
contrary to the concurrence’s suggestion, a sale in a Chapter 11
plan both draws greater scrutiny and subjects the debtor to a
more exacting standard to gain approval.
19 By resting on § 363(m) to dismiss the Lujan and D&V
Claimants’ appeals, our decision does not portend an
abdication of “appellate court[s’] Article [III] powers to
effectively supervise bankruptcy court decisions,” nor does it
insulate § 363(b) sales, “no matter how unlawful,” from
judicial scrutiny. Oral Arg. Tr. 17:4, 7–8. As its procedural
history demonstrates, this is an unusual case. At the time the
Bankruptcy and District Courts reviewed the legality of the

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claims are collateral to the Insurance Policy Buyback,
§ 363(m) does not prevent us from considering their appeals.
C. Equitable Mootness
Because we conclude that the appeals of the Certain
Insurers and Allianz Insurers are not statutorily moot, we reach
Appellees’ alternative argument for dismissal that the doctrine
of equitable mootness precludes relief. In light of the limited
relief those Appellants seek, the success of their appeals does
not threaten to fatally scramble the Plan. Thus, equitable
mootness does not prevent us from reaching the merits of their
claims.
As we explained when we first endorsed this “judge-
made abstention doctrine,” In re Semcrude, L.P., 728 F.3d 314,
317 (3d Cir. 2013), by a slim margin in In re Continental
Airlines, 91 F.3d 553 (3d Cir. 1996) (en banc), equitable
mootness permits a federal court to dismiss and decline to
consider the merits of a bankruptcy appeal following the
consummation of a plan “when, even though effective relief
could conceivably be fashioned, implementation of that relief
would be inequitable,” id. at 559 (cleaned up). The doctrine is
invoked when “requested relief is almost certain to produce a
‘perverse’ outcome—significant ‘injury to third parties’ and/or
Plan, nonconsensual third-party releases were permissible in
this Circuit. Only during the pendency of these appeals did the
Supreme Court decide Purdue and abrogate our precedent on
that issue. So were the Plan proposed today, we harbor little
doubt that the Bankruptcy Court would neither authorize the
Insurance Policy Buyback nor confirm the Plan with its
impermissible releases.

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56
‘chaos in the bankruptcy court’ from a plan in tatters.” In re
One2One Commc’ns, LLC, 805 F.3d 428, 434 (3d Cir. 2015)
(quoting In re Phila. Newspapers, LLC, 690 F.3d 161, 168 (3d
Cir. 2012)). Thus, as put by the doctrine’s proponents,
equitable mootness serves as “an application of the age-old
principle that in formulating equitable relief a court must
consider the effects of the relief on innocent third parties.” In
re Trib. Media Co., 799 F.3d 272, 287 (3d Cir. 2015) (Ambro,
J., concurring) (quoting In re Envirodyne Indus., Inc., 29 F.3d
301, 304 (7th Cir.1994)). In the normal course, “there is a
‘virtually unflagging obligation’ of federal courts to exercise
the jurisdiction conferred on them.” In re Semcrude, 728 F.3d
at 320 (quoting Colo. River Water Conservation Dist. v. United
States, 424 U.S. 800, 817 (1976)). So only in these limited
circumstances has our Circuit adopted equitable mootness as a
“rare exception” where we “dismiss[] an appeal over which we
have jurisdiction.” Id. at 321.
The doctrine is not without its critics. See, e.g., In re
One2One Commc’ns, 805 F.3d at 438–54 (3d Cir. 2015)
(Krause, J., concurring); In re City of Detroit, 838 F.3d 792,
805–814 (6th Cir. 2016) (Moore, J., dissenting). And this case
highlights a potentially troubling aspect of adherence to the
doctrine. As discussed above, Congress took great care to
define the circumstances where appellate remedies are
unavailable, see 11 U.S.C. §§ 363(m), 364(e), and the Supreme
Court has repeatedly admonished that the inclusion of
language in one section of a statute, but omission of it in
another, generally “convey[s] a difference in meaning,”
counseling against the importation of the Code’s limits on
appellate remedies to sections in which they do not appear,
Bittner v. United States, 598 U.S. 85, 94 (2023). Yet others
have defended the doctrine’s validity, see In re Trib. Media

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57
Co., 799 F.3d 272, 284–290 (3d Cir. 2015) (Ambro, J.,
concurring), and the Supreme Court has yet to consider the
question—and not for lack of opportunity.20 Thus, equitable
mootness remains the law of our Circuit.21
We have repeatedly admonished, however, that the
doctrine is “limited in scope” and must be “cautiously
applied.” In re Cont’l Airlines, 91. F.3d at 559; see also In re
Phila. Newspapers, LLC, 690 F.3d at 170; In re Zenith Elecs.
Corp., 329 F.3d 338, 343 (3d Cir. 2003); Nordhoff Invs. Inc. v.
Zenith Elecs. Corp., 258 F.3d 180, 185 (3d Cir. 2001); In re
20 See, e.g., Petition for Writ of Certiorari, U.S. Bank Nat’l
Ass’n v. Windstream Holdings, Inc. (No. 22-926), cert. denied
144 S. Ct. 71 (2023); Petition for Writ of Certiorari, KK-PB
Fin., LLC v. 160 Royal Palm, LLC (No. 21-1197), cert. denied
142 S. Ct. 2778 (2022); Petition for Writ of Certiorari,
Hargreaves v. Nuverra Envtl. Sols., Inc. (No. 21-17), cert.
denied 142 S. Ct. 337 (2021); Petition for Writ of Certiorari,
Aurelius Cap. Mgmt., L.P. v. Trib. Media Co. (No. 15-891),
cert. denied 577 U.S. 1230 (2016).
21 At oral argument, the Lujan Claimants urged us to overrule
our prior cases adopting equitable mootness. But absent en
banc review, we cannot revisit our equitable mootness
precedent. See 3d Cir. I.O.P. 9.1. The Lujan Claimants
alternatively argue that the Supreme Court’s recent decision in
MOAC Mall Holdings LLC v. Transform Holdco LLC, 598
U.S. 288 (2023), makes adherence to our equitable mootness
precedent untenable. But that case merely held that § 363(m)
does not deprive courts of subject matter jurisdiction, see id. at
297, and it did not address the validity of equitable mootness.
We are thus bound to apply our equitable mootness precedent
here.

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PWS Holding Corp., 228 F.3d 224, 236 (3d Cir. 2000); In re
Cont’l Airlines, 203 F.3d 203, 209 (3d Cir. 2000). And,
importantly, equitable mootness is only available in “complex
bankruptc[ies]” “where the reorganization involves intricate
transactions.” In re One2One Commc’ns, 805 F.3d at 435–36
(first quoting In re Phila. Newspapers, 690 F.3d at 169; and
then quoting In re Cont’l Airlines, 91 F.3d at 560–61). In those
“very few cases,” In re Trib. Media, 799 F.3d at 289 (Ambro,
J., concurring), where the doctrine applies, courts deploy it
“with a scalpel rather than an axe,” id. at 278 (quoting In re
Blast Energy Servs., Inc., 593 F.3d 418, 425 (5th Cir. 2010)).
Our criteria for invoking the doctrine have shifted over
time,22 but as we encounter it today, the inquiry has two prongs.
First, we ask “whether a confirmed plan has been substantially
consummated.” In re Semcrude, 728 F.3d at 321. Second, if
it has, we consider “whether granting the relief requested in the
appeal will (a) fatally scramble the plan and/or (b) significantly
22 In In re Continental Airlines, we announced five factors for
courts to consider “in determining whether it would be
equitable or prudential to reach the merits of a bankruptcy
appeal,” including: “(1) whether the reorganization plan has
been substantially consummated, (2) whether a stay has been
obtained, (3) whether the relief requested would affect the
rights of parties not before the court, (4) whether the relief
requested would affect the success of the plan, and (5) the
public policy of affording finality to bankruptcy judgments.”
91 F.3d 553, 560 (3d Cir. 1996) (en banc). While we described
the first factor as “the foremost consideration,” id., we declined
to “specify[] whether those [other] factors are entitled to equal
weight or whether any is necessary or sufficient,” In re Trib.
Media Co., 799 F.3d 272, 278 (3d Cir. 2015).

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harm third parties who have justifiably relied on plan
confirmation.” Id. The party seeking dismissal on equitable
mootness grounds bears the heavy burden of proving its
applicability “based on an evidentiary record, . . . not
speculation.” Id. Bare assertions of inequity and “‘Chicken
Little’ statements” do not suffice. Id. at 324.
With these considerations in mind, we apply this two-
pronged test to the evidentiary record before us.
1. Substantial Consummation
Appellees urge us to conclude, at this first prong, that
the Plan has progressed to the point that it should be considered
substantially consummated. We determine whether the
threshold for “substantial consummation” has been met by
reference to the three criteria set forth in the Bankruptcy
Code’s definition of the term. See, e.g., In re Semcrude, 728
F.3d at 321. Under that definition, “substantial
consummation” means:
(A) transfer of all or substantially all of the
property proposed by the plan to be transferred;
(B) assumption by the debtor or by the successor
to the debtor under the plan of the business or of
the management of all or substantially all of the
property dealt with by the plan; and
(C) commencement of distribution under the
plan.
11 U.S.C. § 1101(2).

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Considering these three criteria—transfer, assumption,
and commencement of distribution—we agree that BSA has
carried its burden at this prong to show substantial
consummation. We address each in turn.
a. Transfer
The Bankruptcy Codes defines “transfer” in the
“broadest possible terms,” In re Fruehauf Trailer Corp., 444
F.3d 203, 211–12 (3d Cir. 2006), including “each mode, direct
or indirect, absolute or conditional, voluntary or involuntary,
of disposing of or parting with—(i) property; or (ii) an interest
in property,” 11 U.S.C. § 101(54)(D). Here, the Settlement
Trust—funding for which constitutes the vast majority of
property dealt with under the Plan—is funded by
approximately $2.48 billion in noncontingent assets, as well as
an estimated several billion dollars in insurance rights. So the
question we consider is whether “all or substantially all” of that
property has been “dispos[ed] of or part[ed] with.” 11 U.S.C.
§ 1101(2)(A).
No doubt, there has been movement of all of
substantially all of that property. Since the Effective Date,
BSA has contributed to the Settlement Trust the BSA
Settlement Trust Note in the principal amount of $80 million;
$42.8 million of proceeds of a loan by the National Boy Scout
Foundation; assignments of insurance rights; the right, title,
and interest in and to artwork valued at approximately $59
million; and oil and gas interests valued at approximately $7.6
million. The Settling Insurers have transferred all their
contributions under the Plan, paying nearly $200 million
directly to the Settlement Trust and placing approximately $1.4
billion into escrow. Local Councils have transferred to the

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Settlement Trust $439 million of their required $500 million; a
promissory note worth up to $121 million; and insurance
rights. They also have undertaken efforts to sell 96 real
properties across the country, over a third of which have been
successful. And the United Methodist Entities have contributed
$2 million of their required $30 million, and they report that
they have collected the remaining $28 million.
But does that movement qualify as “disposing of or
parting with” the property? Some Appellants say not.23 They
point out, correctly, that the Settling Insurers have merely
deposited $1.4661 billion—approximately 90% of their total
contribution to the Settlement Trust—in escrow and not in the
hands of the Settlement Trust. And on that basis, they argue
that “conditionally transferring funds to escrow does not
complete the transaction” and holding the funds in escrow, as
opposed to diverting them directly to the Settlement Trust,
“defeats the notion that there has been a ‘completed’ transfer.”
D&V Opp. Mot. to Dismiss 19–20.
The problem with this argument is that neither
§ 101(54) nor § 1101(2)(A) provide that a “transfer” must be
“completed” or that funds need to reach their “ultimate
destination.” Oral Arg. Tr. 19:12. To the contrary,
§ 101(54)(D) defines “transfer” to include “indirect,”
“involuntary,” and “conditional” means of parting with
property or interests in property, belying the notion that a
23 While we dispose of the Lujan and D&V Claimants’ appeals
on statutory mootness grounds, we consider the arguments they
raise with respect to equitable mootness because whether the
Plan has been substantially consummated equally affects the
Certain Insurers’ and Allianz Insurers’ appeals.

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transaction must arrive at its “ultimate destination” or be
“completed” to constitute a “transfer.”
Having dispatched this argument, we conclude that the
Settling Insurers’ placement of funds into escrow qualifies as
a “transfer.” At its most basic, escrow is a mechanism by
which “property delivered by a promisor to a third party [the
escrow agent] [is] held by the third party for a given amount of
time or until the occurrence of a condition, at which time the
third party is to hand over the document or property to the
promisee.” Escrow, Black’s Law Dictionary (12th ed. 2024).
Thus, once property is placed in escrow, an equitable interest
in that property is transferred from promisor to the
promisee. 28 Am. Jur. 2d Escrow § 16 (2025). The escrow
agent acts as both an agent and fiduciary of the parties and “is
under a duty not to deliver the escrow to anyone except upon
strict compliance with the conditions imposed by escrow
agreement.” 30A C.J.S. Escrows § 19 (2024). So when a party
places property in escrow, it relinquishes control of that
property to the extent provided for in the escrow agreement.
Here, by placing a portion of their Settlement Trust
contribution in escrow, the Settling Insurers conditionally
parted with their property to be distributed upon satisfaction of
the conditions precedent to their funding obligations under the
Plan—i.e., among other things, when the Confirmation Order
becomes a “Final Order.” Such a “conditional” transaction
satisfies the Code’s definition of “transfer.” And with the
Settling Insurers having transferred their share, substantially
all of the property dealt with under the Plan has been
transferred.

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b. Assumption
As to the second criterion for “substantial
consummation”, § 1101(2)(B) requires the “assumption by the
debtor or by the successor to the debtor under the plan of the
business or of the management of all or substantially all of the
property dealt with by the plan.” This provision is doubly
disjunctive, setting out two sub-conditions, each of which may
be satisfied two ways. First there must be “assumption by”
either (1) the debtor, or (2) the successor to the debtor. Second,
the debtor or its successor must have assumed (1) the business,
or (2) management of all or substantially all of the property
dealt with by the plan. Therefore, either the debtor or its
successor need only assume either “the business” or
“management of all or substantially all of the property dealt
with by the plan.”
BSA has satisfied that condition. No party disputes that
“BSA has been operating as a recognized charitable non-profit
. . . since emergence from bankruptcy in April 2023” and “has
fully resumed its operations, including receiving charitable
donations, implementing the robust supplemental youth
protection measures outlined in the Plan, implementing new
bylaws and rules and regulations, and electing new board
members.” BSA Suppl. Br. 7, 13. Thus, BSA has assumed
control of the scouting program, satisfying § 1101(2)(B).
c. Distribution
BSA has also satisfied the third criterion for substantial
consummation: “commencement of distribution under the
plan.” 11 U.S.C. § 1101(2)(C). As the leading bankruptcy
treatise notes—and we agree—“[t]he plain language of

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paragraph (C) does not require commencement of distributions
to all or substantially all classes of creditors. It simply requires
that distributions have begun.” 7 Collier on Bankruptcy
¶ 1101.02[3][a] (16th ed. 2024).
In this case, all agree that the Settlement Trust has
begun distributing settlement payments to abuse claimants. As
of April 22, 2025, 5,552 abuse claimants have elected an
Expedited Distribution under the Trust Distribution
Procedures, resulting in over $18.3 million in distributions
made under that election alone. Additionally, as of that same
date, 12,807 claimants have received distributions under the
Claims Matrix election in the aggregate amount of
approximately $107.4 million. So distributions under the Plan
have commenced, satisfying § 1101(2)(C).
* * *
As the Debtors have demonstrated that the Plan has
been substantially consummated, we proceed to consider the
second prong of the equitable-mootness inquiry.
2. Scrambling the Plan and Justified Reliance
At this step, we assess “whether granting the relief
requested in the appeal will (a) fatally scramble the plan and/or
(b) significantly harm third parties who have justifiably relied
on plan confirmation.” In re Semcrude, 728 F.3d at 321. On
the record before us, BSA and the Settling Insurers have not
demonstrated that the relief the Certain Insurers and Allianz
Insurers seek imperils the Plan’s success. Unlike the Lujan and
D&V Claimants, the Certain Insurers and Allianz Insurers do
not seek invalidation of the releases; instead, they ask us to

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grant them each narrow, cabined relief. The Certain Insurers
ask for minor modifications to three provisions of the Plan to
ensure that they retain their rights and defenses under their
assigned insurance policies. The Allianz Insurers seek only
one modification—that the judgment reduction clause in the
Confirmation Order be amended to allow for recovery of
excess claims they incur in subsequent coverage litigation. We
can hardly say that these minor changes—none of which
disrupts the funding to the Settlement Trust or the bargain
struck between BSA and the Settling Insurers, or requires
clawing back distributions already made to abuse claimants—
meets the high thresholding of “knock[ing] the props out from
under” the Plan. In re Trib. Media, 799 F.3d at 281 (quoting
In re Chateaugay Corp., 10 F.3d 944, 953 (2d Cir. 1993)).
Accordingly, we decline to dismiss these appeals as
equitably moot and proceed to consider the merits of the
Certain Insurers’ and Allianz Insurers’ claims.24
24 To be clear, our omission of this analysis for the claims of
the Lujan and D&V Claimants should not be read, by negative
implication or otherwise, to suggest that those claims are
equitably moot. Under our precedent, equitable mootness
requires a finding of “justifiable reliance,” meaning “reliance
on the finality of confirmation.” In re Trib. Media, 799 F.3d at
280 (emphasis added). Here, our concurring colleague
believes that requirement is satisfied. See Concurring Op. 1 &
n.1. Others, such as the Law Professor Amici, urge that it is
not because the Settling Insurers placed nearly $1.5 billion of
their total contribution to the Settlement Trust into escrow,
thereby limiting their exposure to an adverse judgment and
retaining an interest in the escrowed funds in case the

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D. The Remaining Appeals
As we noted at the outset, the Certain Insurers and
Allianz Insurers each advance arguments that the Plan
impermissibly infringes on their rights under their insurance
policies. Below, we address each of those arguments in turn
and conclude the Certain Insurers’ arguments fail because the
Plan and Confirmation Order already preserve all of the rights
and defenses required. But the Confirmation Order’s judgment
reduction clause impermissibly releases contribution and
indemnification claims the Allianz Insurers otherwise would
be able to assert, and we will reverse with respect to those
claims.
1. The Certain Insurers’ Appeal
The Certain Insurers levy objections to various
provisions of the Plan and Confirmation Order that, they argue,
impermissibly impair their rights and defenses under their
insurance policies. Specifically, they ask us to excise the
language in the Trust Distribution Procedures that states the
Certain Insurers’ rights and the Debtors’ obligations are
“subject to the Plan and Confirmation Order” and preserved
“to the extent such rights and obligations are otherwise
available under applicable law.” App. 1017. They also urge
Confirmation Order is reversed. According to Amici, this
“contingency means that the core funding for the Plan has
barely begun and . . . [t]he Settling Insurers can demand all of
the money back.” Law Professor Amici Suppl. Br. 22. For our
part, having concluded the Lujan and D&V Claimants’
appeals are statutorily moot, we need not resolve whether they
are equitably moot.

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us to blue-pencil the Plan for two purposes: (1) to restore what
they call the “Purpose” provision that would require the
Settlement Trustee to balance the interests of the Certain
Insurers with those of BSA when administering the Settlement
Trust; and (2) to require the Settlement Trustee to “consider
any further limitations on Abuse Claimants’ recovery in the
tort system.” Id. at 1029. Finally, in the alternative, they
contend that the Plan was not proposed in good faith. See 11
U.S.C. § 1129(a)(3). We disagree on all fronts.
a. Preservation of Rights and
Defenses
Non-bankruptcy law generally defines parties’ property
rights. See Butner v. United States, 440 U.S. 48, 55 (1979).
Thus, while the estate is comprised of “all legal or equitable
interests of the debtor in property” “wherever located,” 11
U.S.C. § 541(a)(1), it “cannot possess anything more than the
debtor itself did outside bankruptcy,” Mission Prod. Holdings,
Inc. v. Tempnology, LLC, 587 U.S. 370, 381 (2019). Insurance
policies are property of the estate, and bankruptcy law—save
for exceptions not relevant here—does not alter rights under
those contracts. See NLRB v. Bildisco & Bildisco, 465 U.S.
513, 531–32 (1984); Sharon Steel Corp. v. Nat’l Fuel Gas
Distrib. Corp., 872 F.2d 36, 40 (3d Cir. 1989). So, under
§ 363(b), a debtor may not sell property of the estate, such as
insurance policies, with greater or fewer rights or obligations
than it possessed outside of bankruptcy, and a plan cannot be
confirmed when it incorporates provisions that impermissibly
impair counterparts’ rights. See In re Combustion Eng’g, 391
F.3d at 218.

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The Plan and Confirmation Order, here, do neither and
leave the Certain Insurers’ contractual rights and defenses
intact. For starters, the Confirmation Order provides that
“nothing in the Plan shall modify, amend, or supplement, or be
interpreted as modifying, amending, or supplementing, the
terms of any Insurance Policy issued by a Non-Settling
Insurance Company or rights or obligations under such
Insurance Policy to the extent such rights and obligations are
otherwise available under applicable law.” In re Boy Scouts,
2022 WL 20541782, at *33. And the Plan further confirms that
the Certain Insurers retain their rights and defenses under their
policies: It clarifies that “the Settlement Trust has received the
assignment and transfer of . . . all other rights or obligations
under or with respect to the Insurance Policies (but not the
policies themselves) in accordance with the Bankruptcy
Code.” App. 1017. The Plan goes on to state nothing in the
Trust Distribution Procedures shall:
modify, amend, or supplement, or be interpreted
as modifying, amending, or supplementing, the
terms of any Insurance Policy or rights and
obligations under any Insurance Policy assigned
to the Settlement Trust to the extent such rights
and obligations are otherwise available under
applicable law and subject to the Plan and
Confirmation Order. The rights and obligations,
if any, of any Non-Settling Insurance Company
relating to these TPD[s], or any provision hereof,
shall be determined pursuant to the terms and
provisions of the Insurance Policies and
applicable law.

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Id. (emphasis added). Finally, in Article X, entitled “Rights of
Settlement Trust Against Non-Settling Insurance Companies,”
the Plan again admonishes that the assignments to the
Settlement Trust are subject to the “rights and obligations
under the Insurance Policies.” Id. at 1033.
Nonetheless, the Certain Insurers contend these
provisions are inadequate. As evidence, they point to the
Settlement Trustee’s initiation of insurance coverage litigation
against the Certain Insurers. There, they fault the Settlement
Trustee for seeking “a declaration that the Certain Insurers
have breached the insurance policies and are obligated to
provide full coverage for the Abuse Claims” and complain that
the Trustee “makes no mention of the Certain Insurers’ rights
or defenses under the policies or the Trustee’s corresponding
obligations, which the courts below said were preserved.”
Certain Insurers Opening Br. 43.
First, it should come as no surprise that the Settlement
Trustee—who owes a fiduciary duty to abuse claimants—
would seek to maximize the value of the Settlement Trust by
advancing legal arguments that the Certain Insurers bear
liability for abuse claims. Second, and relatedly, the position
concerning the Certain Insurers’ obligations taken by the
Settlement Trustee in coverage litigation is just that: a litigating
position. Contrary to the Certain Insurers’ contention, the
Settlement Trustee’s litigating positions are not evidence of the
meaning of the Plan or Confirmation Order, nor does the
Settlement Trustee authoritatively interpret those documents
and the provisions contained in them that preserve the Certain
Insurers’ rights and defenses.

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At oral argument, the Certain Insurers insisted we
should not “foist upon the coverage court” the burden of
parsing “600 pages [of Plan documents] and 300 pages of
decisional law” to determine the extent to which the Certain
Insurers’ rights and defenses are preserved. Oral Arg. Tr.
41:18–19. It would be better, they maintain, for the Plan to
incant the magic words they propose in addition to the Plan’s
and Confirmation Order’s existing language. Having grappled
with these appeals ourselves, we appreciate the complexity of
the Plan and the transactions it sets in motion. But we also do
not doubt the competency and discerningness of our judicial
colleagues tasked with resolving the intricate insurance
coverage litigation that will come with administration of the
Settlement Trust. They, no less than we, can interpret the Plan
in light of the background principles of bankruptcy law
discussed above.
For these reasons, we decline to rewrite the Plan and
fasten suspenders to this already well-secured belt.
b. Good Faith
The Certain Insurers also assert that the Debtors failed
to propose the Plan in good faith as required under 11 U.S.C.
§ 1129(a)(3). But this contention, in reality, is just the flip side
of their rights-preservation argument. And for that reason, it
meets the same fate.
Section 1129(a)(3) of the Bankruptcy Code requires that
“[t]he plan has been proposed in good faith and not by any
means forbidden by law.” We have explained that “[i]n
analyzing whether a plan has been proposed in good faith under
§ 1129(a)(3), ‘the important point of inquiry is the plan itself

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and whether such a plan will fairly achieve a result consistent
with the objectives and purposes of the Bankruptcy Code.’” In
re Am. Cap. Equip., LLC, 688 F.3d 145, 156 (3d Cir. 2012)
(quoting In re Combustion Eng’g, 391 F.3d at 247). “[T]wo
‘recognized’ policies, or objectives” we have previously
identified “are ‘preserving going concerns and maximizing
property available to satisfy creditors.’”25 Id. (quoting Bank of
Am. Nat’l Trust & Sav. Ass’n v. 203 N. LaSalle St. P’ship, 526
U.S. 434, 453 (1999)).
Importantly, the Certain Insurers do not challenge the
Bankruptcy Court’s factual findings supporting its good-faith
determination. Instead, they “challenge only the Bankruptcy
Court’s ‘culminating determination’ that the totality of the
circumstances and the language of the Plan support a finding
of good faith.” Certain Insurers Reply Br. 39. And in doing
so, they reveal the real thrust of their argument. At bottom,
25 The Certain Insurers contend that our decision in In re LTL
Management, LLC, 64 F.4th 84 (3d Cir. 2023), governs the
good-faith analysis. But that case concerned whether a
bankruptcy petition was filed in good faith, not whether a plan
was proposed in good faith. See id. at 93. And as we have
held, “[t]he question of whether a Chapter 11 bankruptcy
petition is filed in good faith is a judicial doctrine, distinct from
the statutory good faith requirement for confirmation pursuant
to § 1129(a)(3).” In re Am. Cap. Equip., LLC, 688 F.3d 145,
157 (3d Cir. 2012). So while both inquiries concern the good
faith of the debtor, the good-faith proposal of a plan implicates
unique considerations about the treatment of creditors and the
prospect of effectuating the Code’s purposes. Accordingly, we
decline to graft this “judicial doctrine” into § 1129(a)’s
confirmation requirements.

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they repackage their rights-preservation argument into a good-
faith argument, averring that by not including the Certain
Insurers’ desired language in the Plan, the Debtors did not
propose the Plan in good faith. The remedy they seek lays this
plain: Rather than asserting the Plan is unconfirmable because
BSA did not propose it in good faith, the Certain Insurers
recycle the same relief they requested previously—“[r]estoring
the ‘Purpose’ provision” in the Plan and “substitut[ing] the
word ‘may’ with the word ‘shall’” in the disputed Trust
Distribution Procedures provision. Id. at 39, 45. But failure to
include the Certain Insurers’ desired language does not convert
the Plan into a bad-faith proposal, especially when the Plan
language is otherwise consistent with the Code and
background principles of bankruptcy law.
Because the Certain Insurers provide no basis to
conclude otherwise, we agree with the Bankruptcy and District
Courts that the Debtors proposed the Plan in good faith.
2. The Allianz Insurers’ Appeal
Finally, we consider the Allianz Insurers’ argument that
the Plan and Confirmation Order non-consensually release
their claims and vitiate their ability to recover certain defense
costs. They rely on the Supreme Court’s recent decision in
Purdue, to which we now turn.
In Purdue, the Supreme Court held that the Bankruptcy
Code “does not authorize a release and injunction that, as part
of a plan of reorganization under Chapter 11, effectively seeks
to discharge claims against a nondebtor without the consent of
affected claimants.” Purdue, 603 U.S. at 227. There, in
examining § 1123(b)(6)—the putative statutory authorization

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for nonconsensual third-party releases—the Court concluded
section (b)(6) is limited by the preceding “five specific sorts of
provisions, all of which concern the debtor—its rights and
responsibilities, and its relationship with its creditors.” Id. at
218 (emphasis in original). Thus, it explained, section (b)(6)
“cannot be fairly read to endow a bankruptcy court with the
‘radically different’ power to discharge the debts of a
nondebtor without the consent of affected nondebtor
claimants.” Id. (quoting Epic Sys. Corp. v. Lewis, 584 U.S.
497, 513 (2018)). The Supreme Court reserved the question,
however, of whether its interpretation of § 1123(b)(6) extends
to plans that include “consensual third-party releases” or plans
that “provide[] for the full satisfaction of claims against a third-
party nondebtor.” Id. at 226 (emphasis in original).
The Allianz Insurers contend that Purdue makes the
Confirmation Order’s judgment reduction clause intolerable
because it, coupled with the Plan, impermissibly releases and
enjoins contribution and indemnity claims they could
otherwise assert against the Settling Insurers. We agree.
To fully understand the Allianz Insurers’ objection,
some context proves helpful. When two insurance companies
provide overlapping coverage—such as the Allianz Insurers’
and the Settling Insurers here—the insurer who ends up paying
more than its fair share of a claim may seek contribution from
the other insurer to appropriately allocate their shares of
liability. See, e.g., McDermott, Inc. v. AmClyde, 511 U.S. 202,
215 (1994). The Plan upsets this arrangement by enjoining
claims against the Settling Insurers and channeling them to the
Settlement Trust subject to the judgment reduction clause.
That clause limits a non-settling insurer to recovery against the
Settlement Trust in the form of a reduced judgment, i.e., after

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the Settlement Trust obtains a judgment against a non-settling
insurer, that non-settling insurer can obtain its own judgment
that a Settling Insurer is liable for some (or all) of the
Settlement Trust’s judgment. The non-settling insurer can then
offset that portion of liability attributable to the Settling Insurer
against the Settlement Trust’s judgment, thereby reducing the
non-settling insurer’s liability to the Settlement Trust.26
Usually, this arrangement will pose no problem because
the Settlement Trust will pay claimants under the Plan and, if
necessary, initiate a coverage action against the appropriate
non-settling insurer. And if the non-settling insurer obtains a
judgment against a Settling Insurer, its liability to the
Settlement Trust offsets accordingly. But a non-settling
insurer will not be fully compensated for defense costs if (1)
abuse claimants pursue the Tort System election, (2) a Settling
26 The Future Claimants Representative provides a helpful
example of this mechanism:
For example, if the Trust obtains a judgment
from a Non-Settling Insurer for $1 million, and
the Non-Settling Insurer obtains a ruling that a
Settling Insurer was responsible [for] $250,000
of that liability, to prevent any potential
prejudice to the Non-Settling Insurer, the Plan
requires the Trust to reduce its judgment against
the Non-Settling Insurer by the amount of the
Settling Insurer’s share of the liability. The result
is that the Non-Settling Insurer only has to pay
$750,000.
Future Claimants Representative Answering Br. 44–45.

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Insurer is responsible for defending the claim, but (3) a non-
settling insurer elects to defend the claim instead, and (4)
obtains a judgment in coverage litigation that it is not liable for
the claim. In such a scenario, there would be no judgment held
by the Settlement Trust that the non-settling insurer could
reduce, thereby denying it any recovery for those “excess
claims” it would otherwise be entitled to recover absent the
releases and injunctions in the Plan.
The Allianz Insurers argue that this result is
impermissible under Purdue because the Plan effectively
discharges claims they would have against the Settling
Insurers. And to correct this flaw, they propose amending the
judgment reduction clause to provide that “if [a] Non-Settling
Insurance Company is not subject to any such claim, cause of
action, or judgment held by the Settlement Trust . . . then after
such determination in the Insurance Action, the Settlement
Trust shall pay the amount to the Non-Settling Insurance
Company.” Allianz Insurers Opening Br. Ex. A.
Appellees recognize that Purdue’s “full satisfaction”
language applies here and invokes “the bedrock common-law
principle that a plaintiff is entitled to only one satisfaction for
each injury.” BSA Suppl. Br. 21. Often dubbed the “one-
satisfaction rule,” courts apply this principle to “bar[] a
subsequent suit . . . where the prior proceedings can reasonably
be construed to have resulted in full satisfaction of the
plaintiff’s claim.” United States v. Occidental Chem. Corp.,
200 F.3d 143, 149–50 (3d Cir. 1999) (quoting Greenleaf v.
Garlock, Inc., 174 F.3d 352, 357 (3d Cir.1999)); see also
Restatement (Second) of Judgments § 49 cmt. a (Am. L. Inst.
1982) (“Double recovery is foreclosed by the rule that only one
satisfaction may be obtained for a loss.”). But “[u]nless the

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judgment . . . provides for plaintiff to recover . . . all
recoverable damages, no satisfaction of claim can
occur.” Restatement (Third) of Torts: Apportionment Liab.
§ 25 cmt. b (Am. L. Inst. 2000). And as evidence of its
application, Appellees point us to the District Court’s finding
that “the [Trust Distribution Procedures] streamline and reduce
defense costs by resolving claims consensually through an out-
of-court process. Thus, the likelihood that an Insurer is
saddled with significant costs of defending Abuse Claims in
the tort system is small,” thereby “rendering the protection
provided at least ‘adequate.’” In re Boy Scouts, 650 B.R. at
172–73.
We agree with the Allianz Insurers that Purdue makes
the Confirmation Order’s current judgment reduction
mechanism inadequate. Here, the District Court did not find
that non-settling insurers would be fully compensated for their
extinguished claims.27 It merely found that non-settling
27 The District Court relied upon In re Plant Insulation Co.,
469 B.R. 843 (Bankr. N.D. Cal. 2012), to conclude that, where
a bankruptcy court bars non-settling parties from asserting
contribution claims against settling parties, the non-settling
parties are entitled to “some protection” but “need not be
compensated in full.” In re Boy Scouts of Am. and Del. BSA,
LLC, 650 B.R. 87, 172 (D. Del. 2023). However, Plant
Insulation was an asbestos bankruptcy, and the bar order was
imposed pursuant to § 524(g). In Purdue, the Court noted that
§ 524(g)’s authorization of “injunctions . . . barring any action
directed against a third party” was “a notable exception to the
code’s general rules” and bolstered the Court’s conclusion that
§ 1123(b)(6) did not likewise allow bankruptcy courts to bar

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insurers would be “adequately protected . . . because the
number of claims [they] must defend is reduced, reducing their
defense costs overall.” In re Boy Scouts, 650 B.R. at
172. Accordingly, the District Court’s determination did not
amount to a finding that non-settling insurers would “be
compensated in full” and, thus, did not fully satisfy the claims
at issue. Id. (quoting In re Plant Insulation Co., 469 B.R. 842,
876 (Bankr. N.D. Cal. 2012)). We therefore conclude that
Purdue controls, and the judgment reduction provision is
unlawful insofar as it operates to extinguish the Allianz
Insurers’ claims without their consent.
Without factual findings about the extent of the Allianz
Insurers’ excess claim liability—including, given the various
layers of contingency, whether it is real versus speculative28—
the record does not support the conclusion that the judgment
reduction clause is an adequate alternative to the Allianz
actions against a nondebtor without claimants’ consent. 603
U.S. at 222 (cleaned up). Of course, we do not fault the District
Court’s reliance on Plant Insulation when it did not have the
benefit of the Supreme Court’s subsequent decision in Purdue.
But while its reasoning may have been compelling before
Purdue, it cannot survive the Court’s subsequent decision.
28 The Allianz Insurers acknowledge that the full magnitude of
excess claims is currently uncertain and will not be
ascertainable “until a future coverage determination,” and they
are unaware of a claimant choosing the Tort System election.
Oral Arg. Tr. 45:16–17, 46:1–4. They do assert, though, that
they have exercised their contractual right “to associate in,” id.
at 47:3, to defend various proceedings under the Independent
Review Option and are “incurring defense costs” as a result,
id. at 45:24.

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Insurers retaining the right to full recovery on their excess
claims.29 Thus, we will reverse the District Court’s judgment
as to the Allianz Insurers claims and modify the judgment
reduction clause to impose a Settlement Trust backstop as set
out in Exhibit A of the Allianz Insurers’ Opening Brief. See In
re Combustion Eng’g, 391 F.3d at 218; Gerber v. MTC Elec.
Techs. Co., Ltd., 329 F.3d 297, 307 (2d Cir. 2003) (Sotomayor,
J.). The Bankruptcy Court shall enter an appropriate form of
order on remand.30
29 As we noted above, the Supreme Court in Purdue
admonished that it was not deciding whether nonconsensual
third-party releases are permissible in plans that (1) fully
satisfy third-party claims, or (2) are “effective and . . .
substantially consummated.” Purdue, 603 U.S. at 226. We
need not decide when, in light of Purdue, nonconsensual third-
party releases remain permissible in either scenario because
this case presents neither. For the reasons given above, there
are inadequate factual findings for us to conclude that this is a
full-satisfaction plan, at least with respect to the Allianz
Insurers’ claims. And to the extent that the Court’s substantial-
consummation language refers to equitable mootness, as
explained above, supra Section III.C.2, that doctrine does not
apply to the Allianz Insurers’ appeal.
30 The impact of this holding is not far-reaching. Courts
generally permit provisions like the Plan’s judgment reduction
clause where the judgment is the equivalent of a contribution
claim. See Eichenholtz v. Brennan, 52 F.3d 478, 487 (3d Cir.
1995) (citing TBG, Inc. v. Bendis, 36 F.3d 916 (10th Cir.
1994)). Thus, Purdue does not threaten the typical usage of
judgment reduction in reorganization plans, as it expressly
does not address plans that fully compensate third parties for
the released claims. See Purdue, 603 U.S. at 226.

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79
IV. Conclusion
As the Bankruptcy Court poignantly observed, “no
compensation will ever be enough” for the abuse claimants
have suffered. In re Boy Scouts, 642 B.R. at 518. The Plan
nonetheless permits survivors to pursue their claims through
the Trust Distribution Procedures and recover for at least some
fraction of the suffering they have endured. That human reality
must not be lost among the legal intricacies of these appeals.
Our decision today depends on the unique
characteristics of this Plan, this § 363(b) sale, and the relief
these Appellants seek. The Bankruptcy Code prevents us from
disrupting the nonconsensual third-party releases in BSA’s
Plan at this late stage. If proposed today, the Plan would be
unconfirmable in the wake of Purdue and the Lujan and D&V
Claimants could not have their claims released without their
consent. And that temporal happenstance, we recognize, is a
bitter pill to swallow, “but bankruptcy inevitably creates harsh
results for some players.” In re Weinstein Co. Holdings LLC,
997 F.3d 497, 511 (3d Cir. 2021).
Accordingly, we will dismiss the Lujan Claimants’ and
D&V Claimants’ appeals as statutorily moot under § 363(m),
and affirm in part, reverse in part, and remand for further
proceedings consistent with this opinion.

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1
In re: Boy Scouts of America and Delaware BSA LLC
No. 23-1664 et al.
RENDELL, Circuit Judge, concurring:
The majority’s characterization of the instant appeal of
the Lujan and D&V Claimants as an appeal from a § 363 sale
order is fundamentally flawed, for reasons I detail below. We
need not resort to this characterization—instead, we should
dismiss the Lujan and D&V Claimants’ appeals as equitably
moot. Equitable mootness is firmly rooted in our precedent,
and, as counsel for BSA urged at oral argument, if ever there
were a case crying out for application of the doctrine, this is it.1
Our Court and every Circuit Court with jurisdiction to hear
bankruptcy appeals has adopted equitable mootness.2 But
1 I agree with the majority that the Plan has been substantially
consummated. Maj. Op. 59–64. And striking the releases—as
the Lujan and D&V Claimants urge—would “knock the props
out from under the authorization for every transaction that has
taken place,” thereby “scrambling” the plan and “upsetting
third parties’ reliance on it.” In re Trib. Media Co., 799 F.3d
271, 281 (3d Cir. 2015) (quoting In re Chateaugay Corp., 10
F.3d 944, 953 (2d Cir. 1993)). Thus, equitable mootness is a
straightforward way to resolve the Lujan and D&V
Claimants’ appeals.
2 See In re Trib. Media Co., 799 F.3d 272, 277–78 & n.3 (3d
Cir. 2015); In re Cont’ Airlines, 91 F.3d 553, 559 (3d Cir.
1996) (en banc); In re Healthco Int’l, Inc., 136 F.3d 45, 48

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2
rather than hewing to this well-worn path, the majority
“stretch[es] a statute” to offer a parallel route by which to avoid
review of otherwise-justiciable appeals. In re One2One
Commc’ns, LLC, 805 F.3d 428, 444 (3d Cir. 2015) (Krause, J.,
concurring). We should reject this stretch of § 363 and dispense
with the Lujan and D&V Claimants’ appeals as equitably
moot.3
The first fundamental flaw in the majority’s resort to
§ 363(m) lies in the statute’s clear indication that it does not
apply to sales in reorganization plans as well as the common-
sense observation that the non-consensual third-party releases
were not accomplished by way of the purported § 363
authorization,4 but by way of plan confirmation. So this is an
(1st Cir. 1998); In re Charter Commc’ns, Inc., 691 F.3d 476,
481 (2d Cir. 2012); Behrmann v. Nat’l Heritage Found., 663
F.3d 704, 713–14 (4th Cir. 2011); In re Scopac, 624 F.3d 274,
281–82 (5th Cir. 2010); In re Am. HomePatient, Inc., 420 F.3d
559, 563–65 (6th Cir. 2005); In re UNR Indus., Inc., 20 F.3d
766, 769 (7th Cir. 1994); In re VeroBlue Farms USA, Inc., 6
F.4th 880, 890–91 (8th Cir. 2021); In re Thorpe Insulation
Co., 677 F.3d 869, 879–83 (9th Cir. 2012); In re Paige, 584
F.3d 1327, 1337–38 (10th Cir. 2009); In re Lett, 632 F.3d
1216, 1225–26 (11th Cir. 2011); In re AOV Indus., Inc., 792
F.2d 1140, 1147–48 (D.C. Cir. 1986).
3 I agree with the majority as to the disposition of the Certain
Insurers’ and Allianz Insurers’ appeals.
4 In particular, the Local Councils and Chartered
Organizations were not parties to the sale, so the release of
claims against them could not have been accomplished via the
sale.

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3
appeal from the confirmation order, not the sale. Moreover, the
majority’s opinion endorses an end run around Chapter 11’s
requirements, including the Supreme Court’s holding in
Harrington v. Purdue Pharma L.P., that the Bankruptcy Code
does not permit non-consensual third-party releases in a
chapter 11 plan. 603 U.S. 204, 227 (2024).5 If that is not
enough, as I discuss below, some of the Settling Insurers
constructed the “sale” of their policies such that they will not
occur until the Confirmation Order is affirmed on appeal,
meaning that the majority’s approach will not finally resolve
this case.
While I agree with the majority that this is not a case in
which a pre-confirmation sale made up a “sub rosa” plan, I see
it as just as problematic, for nearly identical reasons. As the
majority acknowledges, the sub rosa doctrine recognizes that
“[t]he court may not . . . in the guise of authorizing a transaction
out of the ordinary course of business [under § 363] in a
chapter 11 case, authorize a transaction that is so extensive as
to be tantamount to a plan.” 3 Collier on Bankruptcy ¶ 363.02
(16th ed. 2025); compare In re Boy Scouts of Am. & Delaware
BSA, LLC, 642 B.R. 504, 562 (Bankr. D. Del. 2022) (“Without
these settlements, there is no Plan.”). Accordingly, the sub rosa
cases are concerned with § 363 being used to skirt Chapter 11’s
requirements and effectively insulate plans from review. See In
re Braniff Airways, Inc., 700 F.2d 935, 940 (5th Cir. 1983); In
re Lionel, 722 F.2d at 1069. By using a § 363 sale to establish
the terms of a plan sub rosa, a debtor can avoid Chapter 11’s
5 Recall that in Purdue the Court made clear that its holding
did not apply to “plans that have already become effective
and been substantially consummated,” that is, to bankruptcy
appeals that are equitably moot. 603 U.S. at 226.

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4
requirements and ensure that “appellate review would
effectively be precluded.” In re Lionel, 722 F.2d at 1069.
Likewise, where, as here, a sufficiently important facet of the
plan makes up “consideration” for a portion of the debtors’
property, a § 363 sale allows debtors to avoid complying with
Chapter 11 (here, 11 U.S.C. § 1126(b)(6)) and insulates the
plan from appellate review. Employing § 363(m) to remove
this category of confirmed plans from judicial review is too
sweeping and radical. We needn’t and shouldn’t go there, for a
number of reasons.
First, § 363 itself distinguishes between sales under
§ 363(b) and (c) and sales under a plan. Subsection § 363(l)
applies to the “use sale, or lease of property” that occurs “under
subsection (b) or (c) of [§ 363] or a plan under chapter 11 . . .
of this title.” 11 U.S.C. § 363(l) (emphasis added). By contrast,
§ 363(m) applies only to a sale or lease authorized “under
subsection (b) or (c) of [§ 363].” 11 U.S.C. § 363(m). Similarly,
§ 363(o) applies to “a sale under [§ 363],” and has been
interpreted (albeit, in decisions that do not bind this Court) to
apply to § 363 sales only, not plan sales. In re Ditech Holding
Corp., 606 B.R. 544, 595 (Bankr. S.D.N.Y. 2019). Tellingly,
the drafters of subsection (o) originally considered language
that would have made the provision applicable to a “sale by a
trustee or transfer under a plan of reorganization.” 147 Cong.
Rec. 2018 at *2031–32 (March 8, 2001) (emphasis added). In
the end, however, Congress adopted narrower language, such
that the provision applies to only a “sale under this section,” 11
U.S.C. § 363(o); 147 Cong. Rec. 2184 at *2191 (March 13,
2001), and not a “transfer under a plan of reorganization,” 147
Cong. Rec. 2018 at *2031–32 (March 8, 2001). Similarly, the
drafters of § 363(m) could have considered (and adopted)
language that brought plan sales within its ambit. Instead,
§ 363(m) narrowly applies to § 363(b) and (c) sales, not plan

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5
sales. As the majority notes, “the inclusion of language in one
section of a statute, but omission of it in another, generally
‘convey[s] a difference in meaning[.]’” Maj. Op. 56 (alteration
in original) (quoting Bittner v. United States, 598 U.S. 85, 94
(2023)).
Perhaps for these reasons, several courts have suggested
that sales accomplished under plans do not fall within
§ 363(m)’s ambit. See Miami Ctr. Ltd. P’ship v. Bank of New
York, 838 F.2d 1547, 1553 (11th Cir. 1988) (holding that
§ 363(m) does not apply to sale under liquidation plan), and In
re Texas Extrusion Corp., 844 F.2d 1142, 1165 (5th Cir. 1988)
(expressing doubt as to whether plan sales may invoke the
“shield” of § 363(m) given the “definite implication that
[§ 363(b), (c), and (m)] concern the trustee’s authority during
the administration of the estate and not at the final disposition
of the property of the estate pursuant to a plan of
reorganization”).6
The majority urges that we have already resolved this
question, as In re Energy Future Holdings, 949 F.3d 806 (3d
6 See also In re Bardos, No. CC-13-1316, 2014 WL 3703923,
at *9 (B.A.P. 9th Cir. July 25, 2014) (concluding that
§ 363(m) did not bar appeal involving plan sale, as plan sales
are authorized under 11 U.S.C. § 1123(a)(5)(B), not § 363); In
re Smurfit-Stone Container Corp., No. 09-10235, 2010 WL
2403793, at *10 (Bankr. D. Del. June 11, 2010) (suggesting
that § 363 does not apply to plan sales). But see In re
Fieldwood Energy LLC, 93 F.4th 817, 825 (5th Cir. 2024)
(applying § 363(m) to a sale authorized by a confirmation
order); In re Made in Detroit, Inc., 414 F.3d 576, 582–83 (6th
Cir. 2005) (same).

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6
Cir. 2020) and Cinicola v. Scharffenberger, 248 F.3d 110 (3d
Cir. 2001) confirmed that § 363(m) may apply to sales
authorized by a reorganization plan, rather than a separate sale
order. Not so. In those cases, a separate Bankruptcy Court
order—not a reorganization plan itself—preliminarily
approved a § 363 sale, and the confirmation order “authorized
and directed” it. Energy Future Holdings, 949 F.3d at 819–20;
Cinicola, 248 F.3d at 122. While Energy Future Holdings does
stand for the proposition that a sale order that is later authorized
in a plan confirmation order does not lose or forfeit the
protection of § 363(m), 949 F.3d at 819–20, that does nothing
to displace the specific terms of the statute, which indicate that
§ 363(m) does not apply to sales that occur as part of a plan of
reorganization. Energy Future Holdings does not govern this
case, where the plan (not a separate order) purported to
“constitute a motion by the Debtors for the Bankruptcy Court
to approve the proposed compromises and settlements and
assignment and/or sale of the applicable Insurance Policies . . .
pursuant to sections 363, 503(b), 507(a)(2), 1123 and 1141 of
the Bankruptcy Code, as applicable,” and the Confirmation
Order, in turn, approved the policy buybacks “pursuant to
sections 363, 1123, and/or 1141 of the Bankruptcy Code” and
stated that the Settling Insurers would be entitled to § 363(m)’s
protections. App. 949, 799, 804–05. This arrangement was
almost certainly crafted in an attempt to insulate the Plan and
Confirmation Order from appellate review—otherwise, the
buybacks of the insurance policies would have been confirmed,
as is typical, by § 1123(a)(5)(D), which allows a plan to sell
“all or any part of the property of the estate, either subject to or
free of any lien.” 11 U.S.C. § 1123(a)(5)(D).
This distinction between this case and Energy Future
Holdings may, at first blush, appear needlessly formalistic. But
there are important differences: First, where a § 363 sale

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7
appears in a separate order, rather than the plan itself, the sub
rosa doctrine gives courts leeway to reverse a § 363(b)
authorization that effectively dictates the terms of a plan.
Indeed, in Energy Future Holdings, this Court could have
reversed the § 363(b) sale had the parties put substantial plan-
like terms into the Merger Order.7 But parties can skirt the sub
rosa doctrine by including a § 363 sale in the plan itself. So
long as Chapter 11’s procedural requirements are met,
substantively controversial, or even unlawful, plan provisions
(like non-consensual third-party releases) can evade appellate
review.8 Next, § 363 contemplates courting of third-party
7 Of course, the Merger Order’s terms were targeted to
allowing a third party to purchase the debtor’s valuable asset
(a liability-free subsidiary) without taking on all of the
debtor’s asbestos liability—not at all a sub rosa plan and
much more limited than the sweeping releases at issue here.
See Energy Future Holdings, 949 F.3d at 813.
8 The majority’s prediction that “an intentional attempt to
transact by ‘means forbidden by law’” would not constitute
good faith under § 363(b) or (m) does not stymie these
concerns. Maj. Op. 50 (quoting In re Abbotts Dairies of Pa.,
Inc., 788 F.2d 143, 150 (3d Cir. 1986)). I do not read § 363’s
good-faith requirement to bar the sort of mischief today’s
holding risks creating. Our Court has interpreted §§ 363(b)
and (m)’s good-faith requirements to ensure that the
purchaser has “paid ‘value’ for the assets of a bankrupt,” and
has not engaged in “fraud[ or] collusion” with the “other
bidders or the trustee” or “attempt[ed] to take grossly unfair
advantage of other bidders.” Id. at 149, 147 (quoting In re
Rock Indus. Mach. Corp., 572 F.2d 1195, 1198 (7th Cir.
1978). This interpretation accords with § 363(m)’s general

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8
investors, a robust bidding process, and a sale approval
process. Realistically, when inserted as part of a globally-
negotiated plan that is being confirmed, the vetting that would
normally occur as part of a sale bidding and approval process
and court order prior to plan confirmation will not occur. Using
§ 363(m) to avoid an appeal deprives the sale of any real
scrutiny.
Separately, and even more critically, the Lujan and
D&V Claimants’ appeal does not challenge the sale of the
insurance policies, it challenges a separate facet of the
Confirmation Order—its approval of non-consensual third-
goal of maximizing the value of the estate. See Cinicola, 248
F.3d at 122.
I am doubtful that this requirement would strip
§ 363(m)’s protections from a purchaser who paid full value
for the debtor’s assets and also received non-consensual third-
party releases. Can it really be said that a party who obtained
a benefit the Supreme Court deemed unlawful, but who
otherwise committed no fraud or collusion “in preparation for
and during the sale itself,” has shown a “lack of integrity”
“during the course of the sale proceedings,” In re Gucci, 126
F.3d 380, 390 (2d Cir. 1997), particularly in light of the fact
that § 363(m) applies even where the purchaser “knew of the
pendency of [an] appeal”? 11 U.S.C. § 363(m). Indeed, even
after Purdue, courts have approved § 363 sales that include
non-consensual third-party releases. In re Hopeman Bros.,
Inc., 667 B.R. 101, 108 (Bankr. E.D. Va. 2025); In re Roman
Cath. Diocese of Rockville Ctr., 665 B.R. 71, 80, 89 (Bankr.
S.D.N.Y. 2024); Wright v. Bird Global, Case No. 24-CV-
23086, slip op. at 4–5 (S.D. Fla. Aug. 21, 2024).

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9
party releases. The majority says that this is “a distinction
without a difference,” because “without the releases, the
Settling Insurers would receive less than they bargained for in
exchange for their cash contribution to the Settlement Trust.”
Maj. Op. 44. But the Local Councils and Chartered
Organizations who transferred their policies to the Debtor
before the sale have also been given releases pursuant to the
plan. Taken to its logical conclusion, the majority’s reasoning
would allow § 363(m) to swallow Chapter 11’s requirements,
including those clarified in Purdue. More often than not, when
a confirmation order authorizes a sale of assets in addition to
various plan provisions, the purchasing party’s cash
contribution has been negotiated in tandem with other plan
provisions. So as long as a court authorizes an intra-plan sale
under § 363, the other plan provisions are shielded from
review, as they may have conceivably affected the purchase
price.9
Congress could not have intended for § 363(m) to
sweep so broadly. As the majority acknowledges, the concept
underlying § 363(m) is that sales to third parties should be
9 This highlights another difference between Energy Future
Holdings and this case: if a § 363 sale can appear in the plan
itself, parties can later argue that any plan provision formed
consideration for the sale and, under the majority’s reasoning,
must therefore be shielded from appellate review. That
argument would be hard to refute given that money is
fungible and virtually any term can be traded for any other
term. Leaving Energy Future Holdings where it lies stymies
this additional opportunity for mischief, and forces debtors
and third-party purchasers to be transparent about what the
consideration for the asset sales truly is.

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10
immune from appeal to maximize the incentive for purchasers
to buy the assets in an otherwise unstable environment, from a
business as well as legal standpoint: “to promote the policy of
the finality of bankruptcy court orders, and to prevent harmful
effects on the bidding process resulting from the bidders’
knowledge that the highest bid may not end up being the final
sale price.” Krebs Chrysler-Plymouth, Inc. v. Valley Motors,
Inc., 141 F.3d 490, 500 (3d Cir. 1998); cf. In re Lionel Corp.,
722 F.2d 1063, 1067 (2d Cir. 1983) (explaining that § 363’s
predecessor statutes aimed to govern leases or sales of goods
with potentially deteriorating value “during the time lag
between the filing of a petition for reorganization and the date
when the plan was approved”). To those ends, § 363(m)
“merely” offers “a targeted protection of [the purchaser’s]
newly acquired property interest” by leaving the sale intact
even when an appeal of its authorization is successful. MOAC
Mall Holdings LLC v. Transform Holdco LLC, 598 U.S. 288,
299–300 (2023). Thus, the strong shield of § 363(m) is meant
to “attract[] investors and help[] effectuate debtor
rehabilitation.” Cinicola, 248 F.3d at 122.
What happened here goes far beyond what § 363
contemplates. Rather than merely protecting the purchaser’s
“newly acquired property interest,” MOAC Mall, 598 U.S. at
300, the majority shields from review the non-consensual
third-party releases that the Supreme Court invalidated in
Purdue.10 This sets a dangerous transactional precedent, one
10 To be sure, at the time the buybacks took place, the
Supreme Court had not yet granted certiorari or announced its
decision in Purdue. Compare App. 11773 (Settlement
Agreement executed February 14, 2022) with Harrington v.
Purdue Pharma L.P., 144 S. Ct. 44 (2023) (granting petition
for writ of certiorari August 10, 2023), and Harrington v.

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11
that will result in Article III courts not having the capacity to
review Confirmation Orders if the parties agree to call key
intra-plan transactions “sales.” Indeed, today’s decision
relegates the Supreme Court’s holding in Purdue to a mere
plan-drafting guide—perhaps the Sackler family should have
purchased the estate’s fraudulent conveyance claims in
addition to the nonconsensual third-party releases and called it
a § 363 sale. See Hopeman Bros., 667 B.R. at 108.
We need not fear, the majority says, because the “vast
majority of challenges, no doubt” will escape § 363(m)’s bar,
as § 363(m) only applies to appeals that affect the validity of a
sale, “a narrow and well-defined category of cases.” Maj. Op.
47, 36. I cannot see how that could be so under the majority’s
own reasoning. An appeal escapes § 363(m)’s bar only if it is
“so divorced from the overall transaction that the challenged
provision would have affected none of the considerations on
which the purchaser relied,” id. at 36 (quoting In re Pursuit
Cap. Mgmt., LLC, 874 F.3d 124, 139 (3d Cir. 2017)), which we
have said will occur “only in . . . rare circumstances.” In re
Pursuit Cap., 874 F.3d at 139.11 In fact, any suggestion that the
Purdue Pharma L. P., 603 U.S. 204 (2024) (invalidating
nonconsensual third-party releases June 27, 2024). But as
counsel for Settling Insurers acknowledged at oral argument,
all parties knew that non-consensual third-party releases were
controversial. Accordingly, the Debtors crafted the Plan such
that the Effective Date—including the insurance policy
buybacks—would not occur until after the District Court
affirmed the Confirmation Order.
11 The picture the majority paints also proves illusory when
one takes a holistic view of our precedent: when faced with
the contention that a bankruptcy appeal is moot under

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12
majority’s ruling is “narrow,” Maj. Op. 36, is belied by this
very case. The majority is willing to extend § 363(m)’s
protection to Local Councils and Chartered Organizations,
who were not parties to any § 363 sale. This view flies in the
face of In re ICL Holding Co., where we said “while § 363(m)
aims to make sales of estate property final and inject
predictability into the sale process, we don’t think it does so at
all costs and certainly not for non-purchasers.” 802 F.3d at 554
(emphasis added).
Finally, some of the Settling Insurers’ agreements
included provisions that their sales will not be completed
unless and until there is a successful appeal. As such, the Lujan
and D&V Claimants’ appeals are not statutorily moot as
applied to those sales. As the majority acknowledges, the Plan
provides: “Notwithstanding anything to the contrary and for
the avoidance of doubt, the Abuse Insurance Policies . . . shall
be sold by the Debtors to the applicable Settling Insurance
Companies . . . on the Effective Date on the terms and as
provided in the applicable Insurance Settlement Agreement.”
Maj. Op. 39–40 (emphasis added) (quoting App. 975). While
the Century and Chubb and Clarendon Insurers’ settlement
§ 363(m), this Court has dismissed the appeal in all but four
instances. See In re Abbotts Dairies of Pa., Inc., 788 F.2d 143,
151 (3d Cir. 1986) (remanding for district court to determine
whether sale was made in good faith); Cinicola, 248 F.3d at
128 (remanding for district court to determine whether relief
would affect validity of § 363 sales); In re ICL Holding Co.,
802 F.3d 547, 554 (3d Cir. 2015) (concluding that § 363(m)
did not bar review); Energy Future Holdings, 949 F.3d at 821
(concluding that § 363(m) barred review of appellants’ first
argument, but not its second).

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13
agreements provide that the sale of their policies shall occur on
the Plan’s Effective Date, the Hartford and Zurich Settling
Insurers’ settlement agreements expressly condition the
Debtors’ sale of their insurance policies on the Confirmation
Order becoming a “Final Order.”12 App. 11231, 11760. The
agreements refer, in turn, to the Confirmation Order’s
definition of Final Order, which means “an order or judgment
of the Bankruptcy Court . . . that has not been reversed,
vacated, stayed, modified, or amended, and as to which,” if
appealed, “such order . . . shall have been affirmed by the
highest court to which such order was appealed . . . and the
time to take any further appeal, petition for certiorari . . . shall
have expired.” App. 885. This has not occurred.
No matter, the majority says, because Ҥ 363(m) speaks
in terms of unstayed authorizations under § 363(b)—it does
not include an inchoate requirement that a § 363(b) sale be
consummated or otherwise effectuated.” Maj. Op. 40. The text
of § 363(m) reads:
The reversal or modification on appeal of an
authorization under subsection (b) or (c) of this
section of a sale or lease of property does not
affect the validity of a sale or lease under such
authorization to an entity that purchased or
leased such property in good faith, whether or
not such entity knew of the pendency of the
12 The majority’s urging that the sales occurred on the
Effective Date based on the Plan and counsels’ statements at
oral argument ignores this express condition and the language
cited above: “as provided in the applicable Insurance
Settlement Agreement.” App. 975.

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14
appeal, unless such authorization and such sale
or lease were stayed pending appeal.
11 U.S.C. § 363(m) (emphasis added).
The majority is right that § 363(m) comes into play
when there is an appeal of a § 363(b) or (c) authorization. But
it bars review of such appeals only to the extent that the appeal
would “affect the validity of a sale or lease under such
authorization. . . unless such authorization and such sale or
lease were stayed pending appeal.” Id. If § 363(m) focused
only on sale authorizations, why separately mention the sale?
Why not say simply that an appeal of an authorization “does
not affect the validity of . . . such authorization . . . unless such
authorization . . . were stayed pending appeal?” Id. Section
363(m) clearly contemplates not only an authorized sale, but a
sale that has occurred.13 An appeal cannot affect the validity of
13 The majority reads this clear textual implication out of the
statute when it suggests that § 363(m)’s requirements can be
met without a consummated sale, so long as the sale has been
authorized. Our § 363(m) caselaw presumes that the sale has
occurred, not just that it has been authorized and may or may
not occur in the future, depending on the success of an appeal
(a very different situation than an installment sale or a
contract providing for ongoing performance). See, e.g., In re
Rickel Home Centers, Inc., 209 F.3d 291, 304 (3d Cir. 2000)
(“The strength of these policies [of § 363(m)] is reflected in
numerous other decisions of the courts of appeals rejecting as
moot an appeal from an order authorizing a sale of estate
property under section 363 when the transaction has been
completed.” (emphasis added)); Pittsburgh Food & Beverage,
Inc. v. Ranallo, 112 F.3d 645, 651 (3d Cir. 1997) (explaining

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15
a sale that has not happened. Cf. In re CADA Invs., Inc., 664
F.2d 1158, 1160 (9th Cir. 1981) (“Because [the purchaser]’s
interest is expressly conditioned on the outcome of this appeal,
a reversal or modification of the appealed order by this court
would not ‘affect’ the sale to [the purchaser] in the manner
prohibited by [the predecessor to § 363].”). Because the sale of
the Hartford and Zurich policies have not occurred, resorting
to statutory mootness does not finally resolve this case. We can
avoid these complications if we rely instead on equitable
mootness.
Equitable mootness is a discretionary principle that the
circuit courts have unanimously adopted. As it arises out of
courts’ discretion to fashion equitable relief, it is to be narrowly
applied, or not applied, as the Article III reviewing court deems
appropriate. See Maj. Op. 56 (citing In re Trib. Media, 799 F.3d
at 287 (Ambro, J., concurring)). Even where it is applied, the
reviewing court has discretion to address the merits of the
appeal if it wishes. See In re Trib. Media, 799 F.3d at 290 n.2
(Ambro, J., concurring) (citing In re Metromedia Fiber
Network, Inc., 416 F.3d 136, 144 (2d Cir. 2005)); In re
One2One, 805 F.3d at 449–50 (Krause, J., concurring). By
contrast, statutory mootness operates essentially as an “on-off”
switch: if a party challenges a plan provision that affects the
validity of a § 363 sale—however the parties have chosen to
conceive of it—courts are stripped of any ability to review that
provision.
For these reasons, I see not only error, but mischief, in
the majority’s approach. Accordingly, I concur in the result, but
that, under § 363(m), “where sale order not stayed and sale
consummated, appeal is moot” (emphasis added)).

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believe that equitable mootness is the way we should reason
through the dismissal of the Lujan and D&V Claimants’
appeals.

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