The release threshold conditions the defendant's funding obligation on receipt of executed releases from a specified proportion of eligible claimants. It differs from participation rate by requiring completed documentation rather than expressed acceptance.
Thresholds may be measured overall or by firm inventory.
Alternative Names:
Release Requirement, Threshold Condition
Why it Matters?
Measuring by executed releases rather than expressed intent is what protects the defendant, since claimants who indicated acceptance but did not complete documentation are not bound. Firm-level thresholds are a further refinement, requiring each participating firm to deliver a specified proportion of its inventory, which prevents a firm from settling its weak claims while holding strong ones back.
Frequently Confused with
Related terms
Frequently asked questions
Why measure executed releases rather than acceptance?
What is a firm-level threshold?
