Delaware Bankruptcy Judge Kevin Carey rejected competing plans of reorganization in the Tribune Co. cases in a 125-page opinion in which he recited the fable of the scorpion and the fox and threatened to sua sponte appoint a Chapter 11 trustee.
In an opinion issued Oct. 31, Carey found that neither the debtors’ plan (backed by the official committee of unsecured creditors and senior lenders) nor the plan of junior noteholders (led by hedge fund Aurelius Capital Management LP) met Bankruptcy Code confirmation requirements. Among other technical defects, Carey held that neither plan had adequate support from impaired classes. In addition, each plan sought impermissible third-party releases. Carey cautioned that the debtors and other constituencies must quickly find a way to emerge from Chapter 11 or he would consider appointing a Chapter 11 trustee on his own motion.
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.
For questions call 1-877-256-2472 or contact us at [email protected]
