Former Footprint Power disclosure statement draws trustee objection

By Sarah Lizee

Olympia, Wash., June 23 – Salem Harbor Power Development LP’s, formerly Footprint Power Salem Harbor Development LP, disclosure statement for its Chapter 11 plan drew an objection on Thursday from Regions 3 and 9 U.S. trustee Andrew R. Vara, according to court documents filed with the U.S. Bankruptcy Court for the District of Delaware.

Vara said the disclosure statement shouldn’t be approved because it doesn’t give enough information about who will be giving and receiving third-party releases, or what claims will be released.

The U.S. trustee said the plan imposes non-consensual third-party releases on many non-debtor parties through a “related parties” clause, whereby over 25 categories of persons and entities will be stripped of their direct claims against non-debtors only because they are related in some fashion to certain releasing parties.

Vara said the disclosure statement also fails to adequately disclose, or explain why, the debtors are giving two sets of releases benefiting the sale released parties.

The U.S. trustee added that the plan is not confirmable due to the scope of the releases.

The disclosure statement hearing is scheduled for June 30.

The Salem, Mass.-based power plant operator filed bankruptcy on March 23 under Chapter 11 case number 22-10239.

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