Tribune creditors want to file more suits
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The creditors' committee for Tribune Co. filed a motion last week for permission to file additional lawsuits against Sam Zell, JPMorgan Chase Bank NA and what the panel calls “former and likely future owners” of the publisher.
At a Nov. 29 hearing, the committee wants the bankruptcy judge to expand authority given in October to file suits insuring no fraudulent transfer claims will be lost by the expiration of time limits under the statute of limitations in bankruptcy. In the new motion, the committee wants authority to bring additional claims for preferences.
The committee says it will file suits without moving the cases forward since some of the competing Chapter 11 plans will settle the claims.
Four plans are competing to reorganize Tribune.
Tribune withdrew a prior version of a reorganization in August following the examiner's report finding a likelihood the second phase of the leveraged buyout in December 2007 could be attacked successfully as a constructively fraudulent transfer. The examiner found less likelihood that the first phase of the transaction in June 2007 could be attacked successfully.
The second part of the buyout entailed the issuance of $2.1 billion on the senior credit and a $1.6 billion bridge loan. For a summary of some of the examiner's conclusions, click here for the July 27 Bloomberg bankruptcy report. Tribune's abandoned plan would have forced through a settlement some creditors opposed.
The $13.7 billion leveraged buyout in 2007 was led by Zell.
Tribune is the second-largest newspaper publisher in the U.S. It listed $13 billion in debt for borrowed money and assets of $7.6 billion in the Chapter 11 reorganization begun in December 2008. It owns the Chicago Tribune, Los Angeles Times, six other newspapers and 23 television stations.
The case is In re Tribune Co., 08-13141, U.S. Bankruptcy Court, District Delaware (Wilmington).
