Weather Updates

Federal appeals court rejects Tribune creditor case

Chicago Tribune

Chicago Tribune

storyidforme: 36739033
tmspicid: 10486891
fileheaderid: 4825570

Updated: October 12, 2012 6:13AM

A federal appeals court in Philadelphia has refused to accept a case from creditors unhappy with Chicago-based Tribune Co.’s plan to exit bankruptcy protection.

On Monday, the court rejected an emergency motion from Aurelius Capital Management, which holds Tribune notes and spearheaded opposition to Tribune’s plan.

Last month, a bankruptcy judge in Delaware required Aurelius and other creditors to post a $1.5 billion bond if they wanted his order approving Tribune’s plan put on hold while they challenged the decision.

After a U.S. District Court judge in Delaware refused to modify the hefty bond requirement, Aurelius turned to the appeals court. The appeals court refused to hear the case, saying the creditors were appealing an order that was not final.

The challenge to the plan continues in federal district court, although Tribune isn’t barred from implementing its plan in the meantime.

A key issue is the fairness of a settlement of legal claims against banks and others involved in Tribune’s 2007 buyout, which left it with $13 billion in debt.


© 2014 Sun-Times Media, LLC. All rights reserved. This material may not be copied or distributed without permission. For more information about reprints and permissions, visit To order a reprint of this article, click here.