Bloomberg Law
Free Newsletter Sign Up
Bloomberg Law
Welcome
Go
Free Newsletter Sign Up

Brazos Judge Strips Ercot Claim’s High-Priority Repayment Status

Jan. 31, 2022, 11:36 PM

U.S. Bankruptcy Judge David R. Jones said the $1.8 billion bill Brazos Electric Power Cooperative received from Texas’ grid operator shouldn’t sit atop the repayment stack because it wasn’t incurred in the ordinary course of business.

  • The ruling Monday means the debt that sent Brazos into bankruptcy will now be classified as a so-called general unsecured claim, equal to other unpaid bills, rather than an administrative priority claim that gets preferred treatment in the bankruptcy
  • Jones made the ruling without the burden of a full-blown trial at the request of Brazos’ official low-ranking creditor committee
    • So-called summary judgments are allowed ...