Lannett asks court to disband unsecured creditors committee

By Sarah Lizee

Olympia, Wash., May 22 – Lannett Co., Inc. asked the U.S. Bankruptcy Court for the District of Delaware to disband a newly appointed official committee of unsecured creditors, according to a motion filed Monday.

The company said there is no justification for the debtors’ estates to bear the costs of an unsecured creditors committee where all holders of general unsecured claims will be unimpaired by the cases.

“Every holder of a general unsecured claim in these pre-packaged Chapter 11 cases will be paid in full and have their claims reinstated under the plan by virtue of a gift from the first-lien senior secured noteholders and second-lien term loan lenders,” Lannett said in its motion.

“In this circumstance, the appointment of the committee and the potential cost of committee professionals to be borne by the estate is simply not justified and not justifiable; the committee cannot improve recoveries for holders of general unsecured claims or further such holders’ interests.”

The company noted that any cost shouldered by the estate decreases the debtors’ liquidity and jeopardizes the ability for the debtors to pay general unsecured claims in full on the current timeline.

As previously reported, the three members of the committee are Computershare Trust Co., NA, based in Columbia, Md., Veranova, LP, based in Wayne, Pa., and Cediprof, Inc., based in Caguas, Puerto Rico.

Based in Trevose, Pa., Lannett develops, manufactures, packages, markets and distributes generic pharmaceutical products. The company filed bankruptcy on May 2 under Chapter 11 case number 23-10559.

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