Strategically unsurprising, Thursday’s filing secures the Unsecured Creditors' legal rights to pursue further action against Zell and others if it decides to. The move doesn’t reflect a breakdown in the reorganization plan or their support for it.
Brodsky made no secret of his disagreement with Tribune management by adding, “The Company has remained in bankruptcy far longer than necessary, because of attendant conflicts of interest and attempts to cover up.”
Tribune’s plan is supported by major creditors JPMorgan Chase, the Committee of Unsecured Creditors and New York equity firms OakTree Capital Management and Angelo, Gordon & Company – in fact, the company’s proposal is heavily based on one the latter hedge funds put forth in September.
The storm clouds of the creditors reorg plans came on the same day that various hedge funds in the company’s bankruptcy sued JPMorgan Chase, Bank of America and Citigroup over the 2007 buyout that took Tribune private. The suit alleges that the banks knew the deal would ultimately fail but went ahead "improperly motivated by tens of millions of dollars worth of fees and the desire to curry favor” with Zell.
Hearings on the various plans are expected in late Nov, with creditor voting not long afterwards … or, as has been common in this Chapter 11 saga, it could all change again.
The duo was at the center of what was being referred to as frat-boy behavior in the company’s executive offices. Tribune is now being run by a four-member executive council of Don Liebentritt, chief restructuring officer, Nils Larsen, chief investment officer, Tony Hunter, president, publisher and CEO of Chicago Tribune Company, and Eddy Hartenstein, publisher and CEO of Los Angeles Times.