Law360 Canada ( March 30, 2021, 6:21 AM EDT) -- Appeal by certain debenture holders from an order approving a plan of arrangement of iAnthus Capital. iAnthus’s secured creditors held secured debentures charging iAnthus’ assets and unsecured creditors which held convertible unsecured debentures. The Restructuring Agreement provided that the plan of arrangement was to include a release of claims against groups defined as “iAnthus Released Parties” and “Securityholders’ Released Parties” except for claims of gross negligence, fraud or wilful misconduct. It further provided that there was to be an injunction against persons taking steps to enforce the released claims. The appellants claimed they were entitled to a secured interest in the assets previously owned by MPX that was combined with iAnthus through a plan of arrangement. The appellants held debentures against these assets and claimed that the debentures continued to subsist because they were not honoured in accordance with the provisions of the plan of arrangement. The chambers judge initially declined to approve the Plan of Arrangement because he found that the release and accompanying injunction contained in the plan rendered the arrangement unfair and unreasonable. iAnthus amended the Plan of Arrangement to narrow the scope of the release and to delete the injunction, and the judge approved the Revised Plan. The chambers judge held that the Revised Plan did not extinguish the appellants’ claim. The appellants argued the judge erred in approving the plan because of the misrepresentation of facts by iAnthus that all material financial information had been provided to the shareholders and the court and in determining the Revised Plan to be fair and reasonable when the appellants were denied their security interest under the Revised Plan....