As defendants increasingly seek bankruptcy as a resolution to multidistrict litigation claims, plaintiffs firms and judges are starting to ask questions about the legitimacy of the tool commonly referred to as the Texas Two-Step.
Plaintiffs lawyers have called the use of bankruptcy as a strategy in multidistrict litigation “blatantly disgusting,” and litigation funders during a recent conversation said they view it dispassionately as a “settlement tool.” A judge will be hearing arguments on the issue this week.
