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Bankruptcy won’t shield you from COBRA claim.

by on
in Employee Benefits Program,Human Resources

Don't think you can escape your COBRA health-insurance continuation responsibilities simply because your organization files for Chapter 11. Recent case: A company filed for bankruptcy one month after it laid off employee Sara Buchanan. She sued, claiming the company failed to provide timely notice of her COBRA rights. An Indiana court sided with Buchanan, saying the automatic freeze on claims that usually applies to Chapter 11 companies didn't extend to separate claims against its employee benefit plan. (Buchanan v. Golden Casting Corp., No. 4:03-cv-151-SEB-WGH, S.D. Ind., 2004)

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