Cite as: 526 U. S. 434 (1999)
Stevens, J., dissenting
superfluous, and because there is no plausible reason why Congress would have desired such a categorical exclusion, given that in some cases old equity may be the most likely source of new capital. See ante, at 452-453. Indeed, the dissenting judge in the Court of Appeals thought "such a result would border on the absurd." 6 Thus, neither the dissenting judge in the Court of Appeals nor the Court appears to be in doubt about the proper answer to my hypothetical question. Instead, the decision is apparently driven by doubts concerning the procedures followed by the Bankruptcy Judge in making his value determinations, implicitly suggesting that the statute should be construed to require some form of competitive bidding in cases like this.7 See ante, at 456-458.
Perhaps such a procedural requirement would be a wise addition to the statute, but it is surely not contained in the
6 Judge Kanne wrote in dissent: "Perhaps the majority's reasoning is driven by the fear that a 'but for' interpretation would prevent old equity from ever participating in a reorganized entity—something Congress could never have intended. Indeed, such a result would border on the absurd, but a simpler, 'but for' causation requirement would not preclude junior interests from participating in a reorganized entity. If prior equity holders earn their shares in an open auction, for example, their received interests would not be 'on account of' their junior interests but 'on account of' their capital contributions." In re 203 N. LaSalle Street Partnership, 126 F. 3d 955, 972 (CA7 1997).
It would seem logical for adherents of this view also to find participation by junior interests in the new entity not "on account of" their prior interest, if it were stipulated that old equity's capital contributions exceeded the amount attainable in an auction, or if findings to that effect were not challenged.
7 This doubt is unwarranted in this case. The bank does not challenge the Bankruptcy Court's finding that the 15 floors of office space had a market value of $55.8 million. The bank's original expert testimony on the value of the property differed from the Bankruptcy Judge's finding by only 2.8%. In re 203 N. LaSalle Street Partnership, 190 B. R. 567, 573- 576 (Bkrtcy. Ct. ND Ill. 1995). Therefore, although the bank argues that the policy implications of the "new value debate" revolve around judicial determinations of the valuation of the relevant collateral, Brief for Petitioner 5, n. 2, this concern was neither squarely presented in this case nor preserved for our review.
467
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