Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca3-19-01430/USCOURTS-ca3-19-01430-0/pdf.json

Parties Involved:
Robert Albini
dismissed_USCA
Denis Bergschneider
Appellant
Harold Bissell
dismissed_USCA
Kurt Carlson
dismissed_USCA
EFH Plan Administrator Board
Appellee
Energy Future Holdings Corp
Not Party
David William Fahy
Appellant
Shirley Fenicle
Appellant
David Heinzmann
Appellant
John H. Jones
Appellant
Public Justice
Amicus Appellant
Reorganized EFH Debtors
Appellee

Document Text:

PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

________________

No. 19-1430

________________

In re: ENERGY FUTURE HOLDINGS CORP, 

AKA TXU Corp., AKA Texas Utilities, et al., 

Debtors

SHIRLEY FENICLE, individually and as successor-ininterest to the Estate of 

George Fenicle; DAVID WILLIAM FAHY; JOHN H. 

JONES; DAVID HEINZMANN; *

HAROLD BISSELL; *

KURT CARLSON; *ROBERT ALBINI, individually and as 

successor-in-interest to the Estate of Gino Albini; DENIS 

BERGSCHNEIDER,

Appellants

________________

On Appeal from the United States District Court

for the District of Delaware

(D.C. No. 1-18-cv-00381)

District Judge: Honorable Richard G. Andrews

________________

Argued September 18, 2019

* Dismissed Pursuant to Court’s Order dated 9/18/19.

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2

Before: KRAUSE and MATEY, Circuit Judges, and 

QUIÑONES ALEJANDRO,

† District Judge

(Opinion filed: February 18, 2020)

Daniel K. Hogan

Hogan McDaniel

1311 Delaware Avenue

Suite 1

Wilmington, DE 19806

Steven Kazan

Kazan McClain Satterley & Greenwood

55 Harrison Street

Suite 400

Oakland, CA 94607

Leslie M. Kelleher [ARGUED]

Jeanna R. Koski

Caplin & Drysdale

One Thomas Circle, N.W.

Suite 1100

Washington, DC 20005

Counsel for Appellants

Matthew C. Brown

Thomas E. Lauria

Joseph A. Pack

White & Case

† Honorable Nitza I. Quiñones Alejandro, District Judge,

United States District Court for the Eastern District of 

Pennsylvania, sitting by designation.

Case: 19-1430 Document: 122 Page: 2 Date Filed: 02/18/2020
3

200 South Biscayne Boulevard

Suite 4900

Miami, FL 33131

J. Christopher Shore [ARGUED]

White & Case

1221 Avenue of the Americas

New York, NY 10020

Jeffrey M. Schlerf

Fox Rothschild

919 North Market Street

Suite 300

Wilmington, DE 19801

Counsel for Appellee Reorganized EFH Debtors

Daniel J. DeFranceschi

Jason M. Madron

Richards Layton & Finger

920 North King Street

One Rodney Square

Wilmington, DE 19801

Mark E. McKane [ARGUED]

Kirkland & Ellis

555 California Street

Suite 2700

San Francisco, CA 94104

Counsel for Appellee EFH Plan Administrator Board

Jennifer Bennett

Public Justice

475 14th Street

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Suite 610

Oakland, CA 94607

Michael J. Quirk

Motley Rice

40 West Evergreen Avenue

Suite 104

Philadelphia, PA 19118

Counsel for Amicus Curiae Public Justice

________________________

OPINION OF THE COURT

________________________

KRAUSE, Circuit Judge.

We must determine whether and under what 

circumstances a bankruptcy debtor’s Chapter 11 plan of 

reorganization may discharge the claims of latent asbestos 

claimants. The Bankruptcy Court determined that the

discharge of such claims is permissible so long as the claimants 

receive an opportunity to reinstate their claims after the 

debtor’s reorganization that comports with due process. We 

agree and therefore will affirm. 

I. Facts

This case, while complex on its surface, is in fact quite 

simple when understood in historical and legal context. We 

thus set out that context before turning to a discussion of the 

underlying facts and procedural history.

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A. Asbestos Litigation in Bankruptcy

The great tragedy of this country’s history of asbestos 

exposure and related disease is by now well documented. The 

asbestos crisis entails “a tale of danger known in the 1930s, 

exposure inflicted upon millions of Americans in the 1940s and 

1950s, injuries that began to take their toll in the 1960s, and a 

flood of lawsuits beginning in the 1970s.” Amchem Prods., 

Inc. v. Windsor, 521 U.S. 591, 598 (1997) (citation omitted). 

Those lawsuits have proved particularly difficult for our courts 

to manage because asbestos exposure gives rise to “a latency 

period that may last as long as 40 years for some asbestos 

related diseases.” Id. (citation omitted). That latency period 

bifurcates most classes of asbestos plaintiffs between those 

who have already contracted asbestos-related disease

(“manifested claimants”) and those who have been exposed 

and are merely at risk (“latent claimants”), see id. at 610–11; 

many of the latter may not even realize the fact of their 

exposure, id. at 611. Such “legions so unselfconscious and 

amorphous” pose problems for which our civil procedure rules

were not designed. Id. at 628.

The poor fit between our civil procedure rules and

asbestos litigation has been mirrored by an equally poor fit 

between our bankruptcy law and asbestos litigation. The 

mismatch occurs because the long latency period for asbestosrelated disease is incompatible with the “public policy of 

affording finality to bankruptcy judgments.” In re Cont’l 

Airlines, 91 F.3d 553, 560 (3d Cir. 1996) (en banc). In the 

normal course of a bankruptcy proceeding, the court sets a 

deadline—known as a “bar date”—before which proofs of 

claim against the debtor’s estate must be filed; all of these 

claims receive treatment under the proposed plan of 

reorganization and, upon confirmation of the plan, all claims 

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for which proofs of claim are not filed are discharged by the 

bankruptcy. But while this “procedural design works relatively 

well in the typical Chapter 11 corporate restructuring of the 

debtor’s current assets and liabilities,” it is poorly outfitted to 

“address the claims of not only current creditors but also 

currently unknowable future creditors” like latent asbestos 

claimants. S. Todd Brown, How Long Is Forever This Time? 

The Broken Promise of Bankruptcy Trusts, 61 Buff. L. Rev. 

537, 541–42 (2013). That is because discharging the claims of 

“unknowable future creditors” implicates due process 

concerns: namely, that they have been deprived of their 

property—their claims—without notice of or a hearing 

regarding the discharge. See id. 

This dilemma was first confronted in the landmark case

of In re Johns-Manville Corp., 68 B.R. 618 (Bankr. S.D.N.Y. 

1986). There, the court announced an “innovative and unique” 

solution to the problem of asbestos-driven bankruptcy. Id. at 

621. The court’s innovation was to abstain from addressing all 

of the debtor’s asbestos liability at once; instead, it provided 

for the creation and funding of a trust by the debtor to address

individual asbestos claims against the debtor as those claims

manifested. Id. at 621–22. To ensure that the claims were 

directed toward the trust, the court imposed an injunction that 

“effectively channel[ed] all asbestos related claims and 

obligations away from the reorganized entity and target[ed]

[them] towards the . . . [t]rusts.” Id. at 624. The injunction 

thereby ensured that latent claimants were “treated identically” 

to symptomatic claimants. Kane v. Johns-Manville Corp., 843 

F.2d 636, 640 (2d Cir. 1988). 

The Johns-Manville court’s innovation proved so 

successful that Congress decided to codify it. As we later 

explained, “The Manville Trust was the basis for Congress’ 

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effort to deal with the problem of asbestos claims on a national 

basis, which it did by enacting § 524(g) of the Bankruptcy 

Code.” In re Grossman’s Inc., 607 F.3d 114, 126 (3d Cir. 

2010) (en banc). That new provision, § 524(g), “took account 

of the due process implications of discharging future claims of 

individuals whose injuries were not manifest at the time of the 

bankruptcy petition,” id. at 127, by requiring the court to 

determine that the injunction is “fair and equitable” to future 

claimants, 11 U.S.C. § 524(g)(4)(B)(ii), to appoint a 

representative of future claimants’ interests, id.

§ 524(g)(4)(B)(i), and to obtain an approval vote from at least 

three-quarters of asbestos claimants, id.

§ 524(g)(2)(B)(ii)(IV)(bb). 

But § 524(g), while expanding the toolbox for resolving 

asbestos liability in bankruptcy, was not a panacea. Our Court 

discovered as much in In re Combustion Engineering, Inc., 391 

F.3d 190 (3d Cir. 2004). There, we recognized that “just and 

efficient resolution of [asbestos] claims has often eluded our 

standard legal process” and, consequently, that “asbestos 

liabilities ha[d] pushed otherwise viable companies into 

bankruptcy.” Id. at 200–01. Combustion Engineering was one 

such case: The debtor had fallen into bankruptcy because of 

“mounting personal injury liabilities,” and it sought to resolve 

its debts with a Chapter 11 reorganization founded upon a 

§ 524(g) trust and injunction. Id. at 201. On the facts of that 

case, however, we were forced to conclude that even the

§ 524(g) trust might have “impermissibly discriminate[d] 

against certain asbestos personal injury claimants,” and we 

therefore “remand[ed] for additional fact-finding.” Id. at 239. 

Our struggle with asbestos-driven bankruptcy and due 

process left off—until today—with Grossman’s. In that case, 

we convened en banc to consider whether a person whose 

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“underlying asbestos exposure occurred pre-petition but

[whose] injury manifested itself post-petition” had a “claim” 

for bankruptcy purposes. 607 F.3d at 117. We held that such 

a person did have a claim—i.e., that bankruptcy claims accrue 

at the time of exposure—overruling our much-maligned rule 

that bankruptcy claims accrued at the time of an injury. Id. at 

125. But as this holding dictated that asbestos claims—even 

those that are latent at the time of bankruptcy—are 

dischargeable through the bankruptcy process, we cautioned 

that “fundamental principles of due process” still applied. Id. 

Thus, while we echoed our earlier observation in Combustion 

Engineering that a § 524(g) trust was “specifically tailored to 

protect the due process rights of future claimants” and was

perhaps the best vehicle for addressing these concerns, id. at 

127 (quoting Combustion Eng’g, 391 F.3d at 234 n.45), we 

made clear that the ultimate question remained whether the 

discharge of latent asbestos claims “comport[ed] with due 

process,” taking into account various factors—only one of 

which was “whether it was reasonable or possible for the 

debtor to establish a trust for future claimants as provided by 

§ 524(g).” Id. at 127–28. 

Against that backdrop, we turn to the facts of this case, 

where latent claims were discharged in bankruptcy without the 

creation of a § 524(g) trust, prompting us again to consider the 

application of due process to this challenging context. 

B. EFH’s Bankruptcy 

Appellee Energy Future Holdings Corporation (“EFH”) 

was a holding company for various energy properties. Among 

EFH’s many subsidiaries were four that we will call, 

collectively, the “Asbestos Debtors”—long-defunct entities 

only in existence because of ongoing asbestos liability. One of 

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the Asbestos Debtors, EECI, was the successor corporation of 

a firm involved in power-plant construction for several decades 

in the mid- to late twentieth century. That industry was reliant 

on asbestos at the time, so EECI’s predecessor exposed its 

employees to slow-acting but life-threatening carcinogens. As 

a result, in the years leading up to this case, EFH was paying 

asbestos-related claims on behalf of the Asbestos Debtors—

principally, it seems, EECI—at a rate of $1 million to $4 

million per year. 

Separately, EFH became debt-distressed as the price of 

natural gas, upon which it relied for revenue, fell due to the 

advent of fracking. That led EFH, along with each of its 

subsidiaries including the Asbestos Debtors, to file a voluntary 

Chapter 11 bankruptcy reorganization petition. The resulting

proceedings were so consequential and complex that the 

diligent and experienced Bankruptcy Court judge handling 

them considered them “the privilege of [his] professional 

career.” JA 1661. Over the course of those proceedings, EFH 

was ultimately split into two entities: One side, with which we 

are not concerned here, emerged from bankruptcy as a separate 

going concern, while the other—what remained of EFH—

sought a buyer. 

The crown jewel of EFH’s remaining holdings was a 

firm called Oncor, the largest electricity transmission and 

distribution company in Texas. Oncor was the locus of 

attraction for EFH’s suitors, among whom were Berkshire 

Hathaway and NextEra, Inc. But EFH could not sell Oncor 

alone without triggering massive tax liability and converting 

the deal into a net loss for the potential buyer. EFH and 

potential buyers thus agreed that, to ensure profitability, the 

sale of Oncor would need to be structured as a merger. And a 

merger meant that the buyer would need to take on not only 

Case: 19-1430 Document: 122 Page: 9 Date Filed: 02/18/2020
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Oncor but also EFH’s other properties, including the Asbestos 

Debtors. 

Understandably, then, EFH’s potential buyers sought to 

ascertain their potential asbestos liability. An expert report 

commissioned by EFH determined that the remaining liability 

was between $36 million and $54 million. With these figures 

in mind, EFH’s first tentative buyer, NextEra, suggested 

creating a § 524(g) trust. But EFH’s lawyers apparently 

believed that the process of establishing such a trust would be 

unwieldy, so they rebuffed the proposal. NextEra’s acquisition 

of Oncor was soon blocked anyway by Texas regulators, 

prompting EFH to open negotiations with another suitor, 

Sempra Energy. 

Sempra, unlike NextEra, did not propose creating a 

§ 524(g) trust to manage EFH’s asbestos liability. Instead, 

Sempra homed in on another potential funding source: 

intercompany loans among EFH and the Asbestos Debtors. 

These loans had been created years before the bankruptcy, 

when the Asbestos Debtors had been effectively liquidated and

EFH had sold their assets and transferred the profits up to the 

parent level. EFH recorded these funds as intercompany loans 

because the money reaped in the sale of the Asbestos Debtors’ 

assets technically belonged to the Asbestos Debtors. By the 

time of EFH’s bankruptcy petition, EFH owed over $800 

million to the four Asbestos Debtors. Sempra proposed to 

reinstate and fund these loans in full after the reorganization so 

as to pay all asbestos claims that were filed by the bar date, 

relegating discharged claimants to the post-confirmation 

process available under the bankruptcy rules—specifically 

Federal Rule of Bankruptcy Procedure 3003(c)(3). That rule 

provides that a bankruptcy court “shall fix and for cause shown 

may extend the time within which proofs of claim or interest 

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may be filed,” Fed. R. Bankr. P. 3003(c)(3), allowing claimants 

to file proofs of claim after the bar date if they show “excusable 

neglect,” see Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd., 

507 U.S. 380, 388–89 (citing Fed. R. Bankr. P. 9006(b)(1)). 

With that process built into EFH’s proposed plan of 

reorganization, the Bankruptcy Court approved the merger 

conditioned upon eventual confirmation of the plan. 

C. The Asbestos Challengers

Although nearly all of EFH’s creditors were satisfied by 

its proposed plan of reorganization, one group of creditors was 

not: latent asbestos claimants. The latent claimants argued that 

setting a bar date for latent claims and discharging any claims 

not filed with the court would violate their due process rights 

under Grossman’s. But the Bankruptcy Court disagreed and 

denied their “[motion] in opposition to the imposition of a 

claims bar date affecting present and future asbestos personal 

injury claimants.” JA 280 (capitalization altered). Instead, 

consistent with Rule 3003(c)(3) and the approach advocated by 

Sempra, it held that “a bar date must be established for all 

claims . . . even though the Court may later extend such bar 

date for cause shown.” JA 350. 

To notify potential asbestos claimants of the bar date, 

EFH agreed to formulate, fund, and implement a notice plan 

that cost over $2 million and that led nearly 10,000 latent 

claimants to file proofs of claim before that date. 

Although they did not attempt an interlocutory appeal 

of the order setting the bar date, latent claimants continued to 

attack the bar date in the subsequent proceedings leading up to 

the confirmation of the plan. In rejecting each of these 

challenges on the merits, the Bankruptcy Court had ample 

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occasion to elucidate its understanding of the due process 

issues. Specifically, the court explained that latent claimants 

whose claims were discharged by the bar date with insufficient 

notice were entitled under the bankruptcy rules to postconfirmation process: 

It is entirely possible that an unmanifested 

claimant may bring a claim after the bar date, 

argue the Debtors’ notice scheme was 

unconstitutional, as applied to her, and be correct 

in that argument. She would have her claim 

reinstated and the Debtors would then be free to 

dispute its validity and/or her damages. But that 

is a retrospective determination, an 

unconstitutional, as applied, determination. 

JA 871. In short, on the clear condition that a path to relief 

consistent with due process would remain available to latent 

claimants, the Bankruptcy Court confirmed the plan, formally 

“consummat[ing]” the EFH-Sempra merger, JA 49, and the 

Confirmation Order formally discharged all claims against the 

reorganized EFH that were not filed before the bar date.

1

Notwithstanding the extension available under Rule 

3003(c)(3) and the assurance that the post-confirmation 

procedure would comport with due process, Appellants—

latent claimants who did not file by the bar date and were 

subsequently stricken with mesothelioma—appealed the 

1 EFH quite candidly acknowledged at oral argument 

that “conceivably those [discharged] claims could be all 

allowable claims,” reinstated on a case-by-case basis, through 

the Rule 3003(c)(3) procedure. Tr. 47.

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Confirmation Order’s discharge of their claims on due process 

grounds. The District Court dismissed the appeal without 

reaching its merits, reasoning that it was barred by 11 U.S.C. 

§ 363(m), commonly referred to as the “statutory mootness” 

provision, see, e.g., Cinicola v. Scharffenberger, 248 F.3d 110, 

122 (3d Cir. 2001), which provides that a party may not seek 

the “reversal or modification on appeal of an authorization . . . 

of a sale or lease of property [that] affect[s] the validity of a 

sale” unless the sale order is stayed, 11 U.S.C. § 363(m). 

Appellants now seek our review, which is plenary.2

 

II. Discussion

Although presented as a single claim, Appellants’ due 

process challenge, on inspection, presents two distinct and 

alternative arguments: first, that Appellants were entitled to 

partake of the pre-discharge claims process by having all latent 

claims deemed timely filed and by recovering through a 

§ 524(g) trust or its equivalent; and second, that to the extent 

Rule 3003(c)(3) was incorporated as a term of the 

Confirmation Order, it is facially unconstitutional because that 

term is categorically incapable of affording due process to any

2 The Bankruptcy Court had jurisdiction under 28 

U.S.C. §§ 157(a) and 1334(b), the District Court had appellate

jurisdiction under 28 U.S.C. § 158(a), and we have appellate 

jurisdiction under 28 U.S.C. §§ 158(d) and 1291. Our review 

of a District Court sitting in review of a Bankruptcy Court is 

plenary. In re W.R. Grace & Co., 729 F.3d 311, 319 n.14 (3d 

Cir. 2013). We review the Bankruptcy Court’s legal 

conclusions de novo and its factual findings for clear error. In 

re Heritage Highgate, Inc., 679 F.3d 132, 139 (3d Cir. 2012). 

Case: 19-1430 Document: 122 Page: 13 Date Filed: 02/18/2020
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latent claimant.3

 But before we can engage the merits of either 

argument, we must contend with the three threshold objections 

raised by EFH: (a) that Appellants’ due process claim is not 

ripe; (b) that it was not timely appealed; and (c) that, as the 

District Court concluded, it was statutorily moot under 11 

U.S.C. § 363(m). We address these issues in turn. 

A. Ripeness

We begin with the “threshold issue” of ripeness.

4

 In re 

Johnson-Allen, 871 F.2d 421, 423 (3d Cir. 1989). EFH 

contends that this appeal is unripe because Appellants have not 

yet sought relief under the post-confirmation process outlined

3 As is implicit in the briefs and made explicit at oral 

argument, Appellants are not making an as-applied challenge; 

rather, they contend that Rule 3003(c)(3) is a categorically 

insufficient “mechanism” for addressing the due process issue. 

Tr. 74.

4 In addition to contesting ripeness as to Appellants 

Jones, Heinzmann, and Bergschneider, EFH challenges the 

justiciability of this appeal on the ground that two other 

Appellants, Fenicle and Fahy, lack standing because they 

timely filed proofs of claim. Be that as it may, however, only 

one appellant must have standing for a case to be justiciable, 

Horne v. Flores, 557 U.S. 433, 446 (2009), and EFH does not

dispute the standing of the remaining Appellants. See Carey v. 

Population Servs. Int’l, 431 U.S. 678, 682 (1977) (“We 

conclude that [one] appellee . . . has the requisite standing and 

therefore have no occasion to decide the standing of the other 

appellees.”).

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by the Bankruptcy Court. We disagree that this fact renders 

the appeal unripe.

A case is ripe when it is fit for judicial decision and 

further withholding of our consideration would cause the 

parties hardship. In re Rickel Home Ctrs., Inc., 209 F.3d 291, 

307 (3d Cir. 2000). To determine whether this standard is met, 

we ask whether the parties are “sufficiently adversarial,” the 

appellants “genuinely aggrieved,” and the issues appropriately 

“crystallized.” Jie Fang v. Dir. U.S. ICE, 935 F.3d 172, 186 

(3d Cir. 2019) (citation omitted). Applying these factors, we 

conclude that the due process arguments raised by Appellants 

are plainly ripe for our review. 

The first two factors are easily resolved: There is no 

question that the parties are “sufficiently adversarial” where 

they have litigated aggressively throughout the five-year 

bankruptcy proceeding, and continue to take conflicting 

positions with respect to the issues involved in this appeal; nor 

is there any doubt that Appellants, who are each affected by

asbestos-caused mesothelioma—a fast-acting and invariably 

fatal form of cancer—are “genuinely aggrieved.” 

That leaves the question whether the arguments raised

by Appellants are appropriately “crystallized,” i.e., whether 

“the facts of the case [have been] sufficiently developed to 

provide the court with enough information on which to decide 

the matter conclusively.” Jie Fang, 935 F.3d at 186 (quoting 

Peachlum v. City of York, 333 F.3d 429, 433–34 (3d Cir. 

2003)). As to both issues, the answer is “yes.” The first issue 

presented by Appellants—whether Appellants were entitled to 

pre-confirmation process—turns simply on our analysis of 

whether the lack of notice to or inadequate representation of 

latent claimants before the discharge violated due process. No 

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facts are left to be developed on this issue because the 

discharge has already been consummated, furnishing us with 

“enough information” to “decide the matter conclusively.” 

The second issue—whether, assuming some postconfirmation process could comport with due process, the

particular process provided here is on its face sufficient—is 

also accompanied by “enough information” to be

“crystallized” for our review. The Bankruptcy Court described 

a post-confirmation process by which Appellants would be 

able to seek reinstatement of their claims upon a showing that 

they were individually deprived of due process, and the 

description it provided supplies “enough information” to 

determine whether that process, at least as a facial matter,

would conform with due process. EFH complains that

Appellants have not yet sought to avail themselves of that postconfirmation process, but while that objection might have 

traction for an as-applied challenge, such additional steps are

not necessary for a facial challenge, unless the challenger’s

actual “need for [process] is speculative,” Artway v. Att’y Gen., 

81 F.3d 1235, 1252 (3d Cir. 1996), or where a new statute is to 

be applied in a way we cannot apprehend in advance, Phila. 

Fed’n of Teachers v. Ridge, 150 F.3d 319, 324 (3d Cir. 1998). 

Neither scenario is presented here. Appellants, already 

affected by mesothelioma, have an immediate “need for” 

whatever process is available to vindicate their claims for 

damages, and we can sufficiently apprehend how the postconfirmation process here—i.e., motions for reinstatement 

under Rule 3003(c)(3)—is to be applied. Accordingly, the 

appeal is ripe. 

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B. Timeliness

EFH next asserts that the appeal constitutes an improper 

collateral attack on the order rejecting the latent claimants’ 

objections and holding untimely filers to the bar date. Per 

EFH, that order could have been appealed but was not; 

therefore, EFH tells us, we should hold that any appeal of that 

aspect of the Confirmation Order is barred. 

Our analysis of this issue is guided by the Court’s recent 

decision in Ritzen Group, Inc. v. Jackson Masonry, LLC, No. 

18-938, 2020 WL 201023 (U.S. Jan. 14, 2020).5

 In Ritzen, the 

Court unanimously held that because “the adjudication of a 

motion for relief from [an] automatic stay forms a discrete 

procedural unit within the embracive bankruptcy case,” it 

constituted “a final, appealable order when the bankruptcy 

court unreservedly grants or denies relief.” Id. at *2. That 

holding abrogated out-of-Circuit precedent to the contrary, see 

In re Frontier Properties, Inc., 979 F.2d 1358, 1364 (9th Cir. 

1992) (“[W]here an issue is determined in an interlocutory 

order and later incorporated into a final order, the 

determination of the original issue is appealable upon an appeal 

of the final order.”), and confirmed the premise of EFH’s 

argument: that the failure to appeal a bankruptcy court’s final, 

appealable order renders a later appeal of the issue embedded 

in a subsequent order untimely. See Ritzen, 2020 WL 201023,

at *7. The question, then, is whether the order denying latent 

5 As Ritzen was decided after this case was briefed and 

argued, the parties were invited to and did submit supplemental 

briefing on its significance for this case.

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claimants’ motion in opposition to the bar date constituted a

final, appealable order for purposes of Ritzen.

6

It does not. A final order in bankruptcy, Ritzen

instructs, is one that “disposes of a procedural unit anterior to, 

and separate from, claim-resolution proceedings.” Id. at *5. 

As the Supreme Court described it, such a separate procedural 

unit, like the stay-relief proceedings at issue in Ritzen, 

generally “initiates a discrete procedural sequence, including 

notice and a hearing”; requires application of a “statutory 

standard”; and does “not occur as part of the adversary claimsadjudication process.” Id.

While EFH’s motion to establish a bar date initiated a 

procedural sequence, including notice and hearing, it does not 

satisfy the remaining elements of the Ritzen finality standard. 

There was no “statutory standard” to govern the question of 

whether the bar date should apply to latent claimants—instead, 

the Bankruptcy Court relied on general principles of due 

process. And the bar date dispute was not anterior to and

separate from, but instead was intertwined with and directly 

concerned, the claims processing provided by the plan 

confirmation. For these reasons, the bar date orders were not 

final and appealable, see In re Hooker Invs., Inc., 937 F.2d 833, 

837 (2d Cir. 1992) (holding that bar date order was not final 

order), and Appellants were entitled to await plan confirmation 

to raise their objections as part of this appeal.

6 The opposition to EFH’s motion to impose a bar date 

was filed by a group of plaintiffs’ law firms, purportedly on 

behalf of all latent claimants. While the Bankruptcy Court 

noted the firms’ apparent lack of standing, it adjudicated the 

dispute on its merits.

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C. Statutory Mootness

The third and last procedural bar invoked by EFH (and 

the one accepted by the District Court) is also the most difficult 

to resolve. EFH contends that this appeal is barred by 11 

U.S.C. § 363(m), and the District Court agreed to dismiss the

appeal on that basis. Appellants make three retorts: first, that

we should recognize a due process exception to § 363(m);

second, that the Confirmation Order was not an “authorization 

. . . of a sale” for purposes of § 363(m); and third, that relief for 

Appellants would not “affect the validity” of the sale. We 

answer each below.

1. Is there a due process exception to § 363(m)?

Appellants’ first argument—that there is a due process 

exception to § 363(m)—is the easiest to dispatch: There is not. 

Certainly, no such exception is found in the text of § 363(m). 

See 11 U.S.C. § 363(m). So the exception would have to come 

from a case, or at least from settled principles in our case law.

The case law, however, is equally devoid of support for

a due process exception. The two cases upon which Appellants

rely for their proposed exception are Hansberry v. Lee, 311 

U.S. 32 (1940), and INS v. St. Cyr, 533 U.S. 289 (2001). 

Neither can bear that weight. Hansberry held that a plaintiff 

was deprived of due process when he was bound by a class 

action to which he was not a party, 311 U.S. at 42–46; St. Cyr

held that a jurisdictional statute should be construed narrowly 

to avoid raising serious questions regarding its constitutionality 

under the Suspension Clause, see 533 U.S. at 313–14. No 

doubt, both dealt with due process challenges to statutes

barring appeal, but the gravamen of those challenges was that 

the plaintiffs would never have an opportunity to present their

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20

underlying merits claims to any federal court if the statutory 

bar applied to their cases. 

Appellants’ position is quite different. They had the

opportunity to present their merits claims in the Bankruptcy 

Court and lost. They could have sought to stay the sale to 

preempt any objections regarding § 363(m); they opted not to 

do so. They now ask us, assuming the other § 363(m) 

requirements apply, to excuse that failure because their merits 

claim happens to be a due process claim. Neither Hansberry

nor St. Cyr remotely stands for that proposition. Due process 

claims do not receive special exemptions from the applicability 

of procedural requirements for the filing of appeals. To the 

contrary, we regularly confront due process or other serious 

constitutional claims by habeas litigants, for instance, who face 

the unparalleled penalties of death or incarceration. Yet we 

apply strict procedural requirements when they bring their 

claims in that context. E.g., Martinez v. Ryan, 566 U.S. 1, 9 

(2012). 

Of course, there are exceptions to every rule—including 

procedural ones. Thus, we might excuse § 363(m)’s 

requirements if Appellants’ underlying claim, due process or 

otherwise, had never been heard at all, as in Hansberry and St. 

Cyr. And we might, too, excuse § 363(m)’s requirements if 

there were a compelling cause outside of Appellants’ control

for their violation of the rule, as there was in Martinez, see 566 

U.S. at 10–11. But neither scenario is presented here. Rather,

§ 363(m), assuming its applicability, permitted Appellants to 

bring their claims in federal court if they complied with the stay 

requirement, and Appellants have not presented a compelling 

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reason to excuse their failure to do so.

7

 We therefore decline 

to recognize Appellants’ proposed “due process exception” to 

§ 363(m).

2. Was the Confirmation Order an “authorization . . . 

of a sale”?

Appellants next assert that the Confirmation Order they 

are appealing was not “an authorization . . . of a sale” under 

§ 363(m). They offer two arguments as to why the 

Confirmation Order is not within § 363(m)’s ambit. Neither is 

persuasive. 

Appellants’ first argument is that there can be only one 

discrete order that qualifies as an authorization of a sale within 

the meaning of § 363(m), and here, that would be the earlier 

Bankruptcy Court order (the “Merger Order”) which held the 

merger authorized under the Bankruptcy Code—not the 

Confirmation Order on which the Merger Order was 

7 Appellants argue—though only in the introduction to 

their opening brief—that they should be excused from the stay 

requirement, in the alternative, because they could not have 

afforded the bond necessary to obtain a stay. This argument is 

perhaps colorable in theory, insofar as it evokes the principle 

that constitutional rights cannot be conditioned on wealth. See 

Bearden v. Georgia, 461 U.S. 660, 672–73 (1983). But

Appellants did not even attempt to obtain a stay, and we are 

therefore unable to determine whether a bond would have been 

required or whether Appellants could have afforded one. 

Appellants’ speculation as to the cost of securing a stay could 

not excuse them from seeking one at all, if it were required. 

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conditioned. A similar argument, however, was resolved 

against Appellants in a closely analogous case.

In Cinicola v. Scharffenberger, 248 F.3d 110, 122 (3d 

Cir. 2001), we considered an appeal by physicians who 

challenged the assignment of their contracts during a 

healthcare corporation’s bankruptcy proceedings. See 248 

F.3d at 115. The physicians had been under contract with 

subsidiaries of the bankrupt corporation, and the corporation’s 

bankruptcy trustee sought approval of a settlement agreement 

that both “involved the sale of assets” and “provided for the 

assignment of the physicians’ employment contracts.” Id. at 

116. The Bankruptcy Court entered an order approving the 

sale but deferred decision on the assignment of the physicians’ 

contracts. Id. at 117. Subsequently, it entered a second order 

authorizing the contract assignment. Id. When the physicians 

appealed that second order without seeking a stay, the trustee 

argued, as EFH does here, that the appeal was barred by 

§ 363(m), and we agreed. Id. at 117–18, 126.

While the physicians argued that the second order 

“represented an independent act,” we disagreed. Id. at 126. 

We concluded that it was “clear the Bankruptcy Court intended 

its Second Order to operate in conjunction with its First Order,” 

id. at 125–26, and that the second order was therefore 

“inextricably intertwined with [the] sale of assets,” id. at 126.

Here, we have little trouble concluding that the 

Confirmation Order and the Merger Order were likewise 

“inextricably intertwined.” The merger agreement expressly 

provided that closing would take place only after entry of the 

Confirmation Order, and the Confirmation Order by its terms 

“authorized and directed” EFH and Sempra to “consummate” 

the merger, JA 49, and recognized Sempra as a good-faith 

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23

purchaser within the meaning of § 363(m). In sum, as in 

Cinicola, it is “clear the Bankruptcy Court intended its Second 

Order to operate in conjunction with its First Order.” We 

therefore reject Appellants’ argument that they are not 

appealing the “authorization . . . of a sale” for purposes of 

§ 363(m).

Appellants next contend that § 363(m) does not apply 

because the specific provision of the Confirmation Order with 

which they take issue—the discharge of latent claims and 

provision for post-confirmation relief—does not authorize the 

sale. But Appellants “do[] not cite any authority that would 

allow us to perform this isolated analysis.” In re Sneed 

Shipbuilding, Inc., 916 F.3d 405, 410 (5th Cir. 2019). And 

dissecting the Confirmation Order in this fashion seems 

particularly inappropriate where that order expressly provides 

that every “term and provision of the Plan” and of “the Merger 

Agreement” was “nonseverable and mutually dependent,” JA 

78–79, and where the record suggests that Sempra bargained 

for and relied upon the discharge of untimely claims in favor 

of a post-confirmation process. Because Appellants challenge

a provision of the Confirmation Order that was both formally 

and practically bound up with the sale authorization, we will 

follow our general rule that “any reasonably close question 

about the applicability of § 363(m) should be answered in favor 

of applicability,” In re Pursuit Capital Mgmt., LLC, 874 F.3d 

124, 134 (3d Cir. 2017), and conclude that Appellants do 

appeal an “authorization . . . of a sale.”8

 

8 Appellants point out our cautionary note that § 363(m) 

“does not moot every term that might be included in a sale 

agreement, even if each is technically integral to that 

transaction.” In re ICL Holding Co., 802 F.3d 547, 554 (3d 

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3. Would the requested relief “affect the validity of [the] 

sale”?

We turn to the final requirement to trigger § 363(m)’s 

bar: whether the appeal would “affect the validity of [the]

sale.” To answer this question, we must draw from and 

therefore briefly review our § 363(m) jurisprudence.

We typically refer to § 363(m) as a rule of “statutory 

mootness.” E.g., Cinicola, 248 F.3d at 124. In many circuits, 

the “mootness” label is an apt one because § 363(m) is read 

essentially as a jurisdictional bar against any appeal of an 

unstayed sale order. See, e.g., In re Gucci, 105 F.3d 837, 839–

40 (2d Cir. 1997) (limiting the court’s inquiry “to the issue of 

good faith”). But in our Circuit, “mootness” is a bit of a 

misnomer because we have construed § 363(m) as a constraint 

not on our jurisdiction, but on our capacity to fashion relief. 

Krebs Chrysler-Plymouth, Inc. v. Valley Motors, Inc., 141 F.3d 

490, 498–99 (3d Cir. 1998). This interpretation, while a 

minority one, is for us well settled and consistent with the 

views of the Sixth and Tenth Circuits. See In re Brown, 851 

Cir. 2015) (internal quotation marks and citation omitted). But 

we made this remark not in assessing whether a given 

document constituted an “authorization . . . of a sale,” but 

whether we could grant relief that would “affect the validity of 

a sale” under § 363(m), see id.—a separate inquiry to which 

we next turn. It is quite sensible to construe broadly the 

applicability of § 363(m) to “promote the finality of sales” in 

furtherance of Congress’s intent, see Pursuit Capital, 874 F.3d 

at 133, but to ensure that it is not actually applied to individual 

challenges that are so minor as to not affect that finality 

interest, see ICL Holding, 802 F.3d at 554. We deal here only 

with the initial question of applicability.

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25

F.3d 619, 623 (6th Cir. 2017); In re C.W. Mining Co., 641 F.3d 

1235, 1239–40 (10th Cir. 2011). It is also, we believe, the 

correct one, for the provision by its terms forbids only those 

appeals that “affect the validity of a sale,” not all those that call 

into question any aspect of such a sale. See ICL Holding, 802 

F.3d at 554. 

Our task, then, after ascertaining 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, is to “see whether a 

remedy can be fashioned that will not affect the validity of the 

sale.” Krebs Chrysler-Plymouth, 141 F.3d at 498–99. To be 

sure, demonstrating the availability of such relief “is a high 

bar.” Pursuit Capital, 874 F.3d at 139. The ultimate question 

is whether the grant of relief would, in effect, “claw back the 

sale,” ICL Holding, 802 F.3d at 554, so a challenger seeking to 

avert § 363(m)’s bar must demonstrate that the relief affects

only “collateral issues not implicating a central or integral 

element of a sale,” Pursuit Capital, 874 F.3d at 139. While

requested relief that would materially increase or decrease the 

purchase price would plainly affect the validity of the sale, see 

Pittsburgh Food & Beverage, Inc. v. Ranallo, 112 F.3d 645, 

649 (3d Cir. 1997), other requested relief may require more 

careful study depending on the nature of the claim and the type 

of relief sought, see, e.g., ICL Holding, 802 F.3d at 554

(holding in the context of contested rights to an escrow that 

reallocating the purchase funds among creditors does not affect 

the validity of the sale). 

With these principles in mind, we turn to Appellants’ 

two due process arguments, each of which would entail a 

different type of relief and thus must be analyzed separately. 

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Appellants’ first argument is that they are entitled to the 

same treatment as creditors who timely filed proofs of claim, 

such that their claims must be held to have been “not 

discharged” and “retained against the debtors,” Tr. 70, and 

EFH must establish the equivalent of a § 524(g) trust to 

administer disbursements.9

 Ordering such relief would plainly 

affect the validity of the sale. Sempra planned carefully for the 

amount and the character of the debt, the intercompany 

relationships, and the associated tax implications that would 

accompany its present asbestos liability, in contrast with its 

potential future liability under a post-confirmation process. 

Allowing latent claims for which no proof of claim was filed

to be retained and establishing the equivalent of a § 524(g) trust 

would fundamentally alter those expectations. Specifically, a 

blanket allowance of latent claims would increase Sempra’s 

purchase price by exposing it to present asbestos liability it did 

not bargain for, rather than to the future liability for which it 

did. And under Pittsburgh Food & Beverage and its progeny, 

an alteration of the price term would “affect the validity of the 

9 Appellants rely for this proposition on Connecticut v. 

Doehr, 501 U.S. 1 (1991), which required pre-deprivation 

process because even a “temporary deprivation”—a 

prejudgment attachment that “cloud[ed] title [and] impair[ed] 

the ability to sell”—caused permanent loss. Id. at 11, 15. But 

in other cases, like Zinermon v. Burch, 494 U.S. 113 (1990), 

post-deprivation process is particularly appropriate because it 

is “impossible for the State to predict such deprivations and 

provide predeprivation process.” Id. at 129. Here, we note that 

it would have been “impossible” for the Bankruptcy Court to 

“provide predeprivation process” because, at the time of the 

bar date, unmanifested claimants were unknown—in 

Appellants’ words—“even to themselves,” Appellants’ Br. 24. 

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sale.” 112 F.3d at 649–50. We are therefore barred by 

§ 363(m) from reaching Appellants’ argument that they were 

entitled to pre-confirmation process.

We take a different view, however, of Appellants’

second argument, that Rule 3003(c)(3)’s claim reinstatement 

procedure is incapable of providing due process to latent 

claimants, rendering this term of the Confirmation Order

facially unconstitutional. Because, as EFH concedes, a fair 

post-confirmation process was contemplated by the plan of 

reorganization, to which Sempra agreed by effectuating the 

merger, our review of whether Rule 3003(c)(3) can provide fair 

process could not conceivably “affect the validity of the sale,”

see Krebs, 141 F.3d at 498–99; it was part and parcel of the 

sale. Section 363(m) thus poses no bar to our review of 

whether the post-confirmation process anticipated by the 

Confirmation Order, i.e., Rule 3003(c)(3), is facially 

inadequate to afford due process to latent claimants. We turn 

now to that sole surviving argument.

D. Due Process

To show that this aspect of the Confirmation Order is 

facially unconstitutional, Appellants must establish both a 

deprivation of an “individual interest that is encompassed 

within the Fourteenth Amendment’s protection of life, liberty, 

or property” and the absence of procedures that “provide due 

process of law.” Hill v. Borough of Kutztown, 455 F.3d 225, 

234 (3d Cir. 2006) (internal quotation marks and citation

omitted). But as we explain below, while Appellants’ due 

process claim undoubtedly satisfies the first component, it falls 

short on the second because the combination of notice and 

hearing available to them is constitutionally adequate.

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At the first step, Appellants have demonstrated a 

deprivation of a protected interest. We have recognized as a 

protected property interest the ability to pursue an asbestos 

claim. See Grossman’s, 607 F.3d at 127. Because Appellants 

challenge the post-confirmation process as depriving them of 

their ability to pursue their asbestos claims, they have asserted 

a cognizable property interest within the protection of the Due 

Process Clause. 

We must then ask, in connection with this protected 

interest, “what process the State provided, and whether it was 

constitutionally adequate.” Revell v. Port Auth. of N.Y. & N.J., 

598 F.3d 128, 138 (3d Cir. 2010) (citation omitted). This 

inquiry is more searching: It “examine[s] the procedural 

safeguards built into the statutory or administrative procedure 

of effecting the deprivation, and any remedies for erroneous 

deprivations provided by statute.” Id. (alteration in original)

(citation omitted). Although the appropriate safeguards are 

“dictated by the particular circumstance,” Rogal v. Am. Broad.

Cos., 74 F.3d 40, 44 (3d Cir. 1996) (citation omitted), the 

standard safeguards are some form of “notice and a hearing,” 

Wilson v. MVM, Inc., 475 F.3d 166, 178 (3d Cir. 2007). Here, 

the combination of both the pre-confirmation notice provided 

and the post-confirmation hearing available are adequate. 

As for pre-confirmation notice, Appellants do not 

dispute that they received publication notice prior to the bar 

date. EFH launched a multimillion-dollar notice plan to 

contact latent claimants and notify them of the impending bar 

date and the accompanying need to file a proof of claim. All 

latent claimants who timely filed proofs of claim—and there 

were nearly 10,000 such claimants—were assured of retaining 

their ability to pursue their claims and, contrary to Appellants’ 

argument that actual notice to all potential claimants was 

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required, claimants who were unknown at the time of the 

discharge—such as Appellants—were entitled only to 

publication notice of a property deprivation, Mullane v. Cent. 

Hanover Bank & Tr. Co., 339 U.S. 306, 317–18 (1950). We 

are also unpersuaded that EFH was not “desirous of actually 

informing” latent claimants of the bar date, id. at 315; to the 

contrary, it employed a noticing expert, “follow[ed] the 

principles in the Federal Judicial Center’s . . . illustrative model 

forms of plain language notices,” JA 392, and published notice

in seven consumer magazines, 226 local newspapers, three 

national newspapers, forty-three Spanish-language 

newspapers, eleven union publications, and five Internet 

outlets. Under our case law, that publication was sufficient. 

See Chemetron Corp. v. Jones, 72 F.3d 341, 348–49 (3d Cir. 

1995) (holding that publication in two national newspapers and 

seven local newspapers was constitutionally sufficient). 

As for the post-confirmation hearing available to latent 

claimants, again due process is satisfied. The Bankruptcy 

Court retains jurisdiction over the parties to consider whether 

it unconstitutionally discharged individual claims, see In re 

W.R. Grace & Co., 900 F.3d 126, 138–39 (3d Cir. 2018), and 

as EFH agrees, the Bankruptcy Court must accept late-filed 

proofs of claim under Federal Rule of Bankruptcy 3003(c)(3)

for “cause shown.” Fed. R. Bankr. P. 3003(c)(3). That 

“flexible” standard is met when the “danger of prejudice to the 

debtor” is low; the claimant shows good “reason for the delay”; 

and the “length of the delay” does not have outsize “impact on 

[the] judicial proceedings.” Pioneer Inv. Servs., 507 U.S. at

389, 395 (applying “excusable neglect” standard of Fed. R. 

Bankr. P. 9006 to Rule 3003(c)(3)). Our review of these three 

factors convinces us that deserving latent claimants will have 

adequate opportunity to obtain reinstatement through Rule 

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3003(c)(3) motions and that this path to relief is not, as 

Appellants assert, categorically incapable of affording due 

process to latent claimants.10

First, all latent claimants will have the opportunity to

show that reinstatement of their claims would pose no “danger 

of prejudice” to the debtors here. As we have explained, the 

prospect of a post-confirmation procedure allowing for 

reinstatement was baked into the merger agreement, and Rule 

3003(c)(3) provides that procedure. Reinstatement of latent 

claims under Rule 3003(c)(3) thus would appear not to not alter 

the expectations the parties had at the time they agreed to the 

merger.

Second, latent claimants will have the opportunity to

demonstrate a “reason for the delay” by showing that they 

would otherwise be deprived of due process under 

Grossman’s. As we made clear in that case, a latent claim

cannot be constitutionally discharged if the claimant received

inadequate “notice of the claims bar date”—a concern that 

“arise[s] starkly in the situation presented by persons with 

asbestos injuries that are not manifested until years or even 

decades after exposure,” Grossman’s, 607 F.3d at 126, because 

“persons in the exposure-only category . . . may not even know 

of their exposure,” may not “realize the extent of the harm they 

may incur,” or “[e]ven if they fully appreciate the significance 

of [notice they did receive], . . . without current afflictions[,] 

10 We hold today that Rule 3003(c)(3) is not 

categorically incapable of providing due process so that the 

post-confirmation process anticipated by the Confirmation 

Order is not facially unconstitutional. We do not foreclose an 

as-applied challenge by any latent claimant who contends that 

he did not, in fact, receive due process.

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may not have the information or foresight needed to decide, 

intelligently, whether [to file a claim],” Amchem, 521 U.S. at 

628. For that reason, we identified in Grossman’s factors 

bearing on the “adequacy of the notice of the claims bar date,” 

607 F.3d at 127, including—with particular relevance for the 

Rule 3003(c)(3) proceedings we consider today—“whether the 

notice of the claims bar date came to [the claimants’

attention],” “whether and/or when the claimants were aware of 

their vulnerability to asbestos,” and “whether the claimants had 

a colorable claim at the time of the bar date,” id. at 127–28. 

Thus, latent claimants will have a chance to argue based on 

those factors that the permanent discharge of their respective 

claims would not comply with due process under 

Grossman’s—undoubtedly an adequate “reason for the 

delay”—and obtain reinstatement under Rule 3003(c)(3).

Finally, while the “length of the delay” between the bar 

date and latent claimants’ Rule 3003(c)(3) motions will be 

substantial, latent claimants will not be precluded from arguing 

that the delay had no “impact” on EFH’s bankruptcy 

proceedings because those proceedings concluded with the 

Confirmation Order so this factor, too, cuts in favor of granting 

their Rule 3003(c)(3) motions. 

In sum, our excursion through the Rule 3003(c)(3)

factors convinces us that the Rule is capable of providing latent 

claimants with a fair opportunity to seek reinstatement. It

allows them to argue that their late filings would impose no 

prejudice on EFH and that the length of their delay would not 

affect any bankruptcy proceeding.11 It likewise allows them to 

11 We have not independently discussed the final Rule 

3003(c)(3) factor, good faith, see Pioneer Inv. Servs., 507 U.S. 

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argue that, without reinstatement, they would not be accorded 

due process under Grossman’s. This showing is only 

negligibly more demanding than the one necessary to file a 

proof of claim before the bar date—it requires that latent 

claimants allege a single additional fact, i.e., lack of due 

process under Grossman’s, and this one additional requirement

does not render the Rule 3003(c)(3) process unconstitutional.

Appellants also object that the procedural barriers to 

obtaining Rule 3003(c)(3) relief necessarily deprive them of 

due process. But obtaining such relief is in fact quite simple—

especially as courts must accord “special care” to pro se 

claimants, see Mathewson v. Mathewson, 311 F.2d 833, 833 

(3d Cir. 1963), “liberally constru[ing]” their filings and 

holding them “to less stringent standards than formal pleadings 

drafted by lawyers,” Erickson v. Pardus, 551 U.S. 89, 94 

(2007) (per curiam) (citation omitted)—meaning that none of 

Appellants’ logistical concerns holds weight. 

It is true, as Appellants point out, that they must “carry 

the burden of proof” under Rule 3003(c)(3), Appellants’ Br. 

32, but that burden for these latent claimants is a light one: 

Appellants need only file a basic motion reciting the fact that 

reinstatement of their claim will neither prejudice EFH nor 

impact its bankruptcy proceedings and attach a sworn affidavit

explaining why they were deprived of due process under 

Grossman’s. See Pioneer Inv. Servs., 507 U.S. at 384. And

while Appellants express concern that Rule 3003(c)(3) motions 

will be processed slowly so recoveries will be unfairly delayed,

we are confident that the Bankruptcy Court will resolve those 

motions swiftly given the relatively simple showing required 

at 395, but we note that the application of that requirement to 

bar any bad-faith latent claims would not offend due process.

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to obtain relief and the sensitivity the Bankruptcy Court has 

shown to the crippling and fast-acting nature of asbestosrelated diseases.12 

Finally, though Appellants note their concern that any 

added delay in reinstatement might reduce the quantum of 

potential damages they recover, that concern relies upon a 

patent misreading of a single state’s damages statute. Compare 

Appellants’ Br. 32 (interpreting Cal. Civ. Proc. Code § 377.34 

as providing that damages “do not survive the death of the 

injured party”) with Cal. Civ. Proc. Code § 377.34 (providing 

that damages are “limited to the loss or damage that the 

decedent sustained or incurred before death”). 

In all, then, Rule 3003(c)(3) is capable of affording 

latent claimants a fair opportunity post-confirmation to seek

reinstatement of their claims, and we reject Appellants’ due 

process challenge to that aspect of the Confirmation Order.

* * *

12 Appellants are also protected by the fact that the

statutes of limitations applicable to asbestos claims generally 

run from the date of diagnosis, see, e.g., In re Asbestos Litig., 

673 A.2d 159, 162 (Del. 1996); Lapka v. Porter Hayden Co., 

745 A.2d 525, 553–54 (N.J. 2000); Abrams v. Pneumo Abex 

Corp., 981 A.2d 198, 210–11 (Pa. 2009), and are often applied 

flexibly, see, e.g., Mergenthaler v. Asbestos Corp. of Am., 500 

A.2d 1357, 1365 (Del. Super. Ct. 1985); Wanner v. Philip 

Carey Mfg. Co., 580 A.2d 734, 736–37 (N.J. Super. Ct. App. 

Div. 1989); Mihalcik v. Celotex Corp., 511 A.2d 239, 244–45 

(Pa. Super. Ct. 1986).

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Though we decline to upset the approach taken here, we 

share the Bankruptcy Court’s “regret” that “the debtors asked

for [a bar date] in the first place,” both because the bar date 

might “adversely affect . . . [claimants] who have manifested 

injury . . . or will manifest injury based on prepetition exposure 

who have not filed proofs of claim” and because it “led to a lot 

of litigation and a lot of expense and a $2 million noticing 

program.” JA 1631. Indeed, this case serves as a cautionary 

tale for debtors attempting to circumvent § 524(g). The 

alternative route EFH has chosen for addressing its asbestos 

liability has produced a similar result as a § 524(g) trust—

reimbursement for latent claimants who either filed proofs of 

claim or did not receive proper notice of the bar date—but with 

added and unnecessary back-end litigation. Like the 

Bankruptcy Court, however, we have only “a limited role” in 

this case. JA 1630. We are not charged with ensuring that 

EFH’s strategic choices were optimal or even advisable; we are 

merely asked to ensure that they satisfy the Bankruptcy Code 

and the Constitution. And in this limited role, we conclude that 

the post-confirmation process described above satisfies both.

III. Conclusion

For the foregoing reasons, we will affirm. 

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