Mark Eveland, CEO of Verus. Courtesy photo Four Ways the Texas Two-Step Changes How Plaintiffs Litigate Mass Torts
The Texas Two-Step is a bankruptcy process in which a solvent corporation spins off certain liabilities into a new and undercapitalized subsidiary and then has the subsidiary declare bankruptcy.
July 13, 2023 at 12:26 PM
10 minute read
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By enabling defendants to shield themselves from mass tort liability, the "Texas Two-Step" is a new obstacle for plaintiffs pursuing mass tort cases against manufacturers of dangerous products. For the uninitiated, the Texas Two-Step is a bankruptcy process in which a solvent corporation spins off certain liabilities into a new and undercapitalized subsidiary and then has the subsidiary declare bankruptcy.
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