Court Upholds Debtor's Automatic Stay in Wake of Motion to Compel Arbitration in Insurance Dispute

WILMINGTON, Del. - A U.S. District Court recently affirmed a decision to enforce an automatic stay of claims filed against a bankrupt asbestos defendant and deny an insurance company's motion to compel arbitration of a coverage dispute related to asbestos claims filed against the debtor. In re: Kaiser Aluminum Corporation, Safety National Casualty Corporation v. Kaiser Aluminum and Chemical Corporation, No. 02-1580-JJF (D. Del.).

Judge Joseph F. Farnan, Jr. of the U.S. District Court for the District of Delaware issued the order Dec. 18, affirming the bankruptcy court's finding that by compelling arbitration of the underlying dispute, Safety National …