Putting Teeth Into Section 1113(f)?

Courts have wrestled for 20 years over the priority of claims asserted by workers if a chapter 11 debtor-in-possession fails to comply with its obligations under a collective bargaining agreement ("CBA"). Some courts, reasoning that such claims do not meet the traditional standards for administrative priority, relegate them to the pool of general unsecured claims. Other courts focus on the special protections afforded workers covered by a CBA under section 1113 of the Bankruptcy Code as grounds for granting such claims priority. The Tenth Circuit Court of Appeals recently injected its voice into this debate and staked out an interesting middle-ground position. In Peters v. Pikes Peak Musicians Association, the Court of Appeals ruled that the debtor’s obligation under a CBA for payments to employees that became due between the chapter 11 petition date and the date that the