Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comFirm Insights
LightSquared seeks ruling ahead of bankruptcy hearing
Author: Joel R. Glucksman
Date: March 27, 2014
Key Contacts
Back
Broadband company LightSquared urged U.S. Bankruptcy Judge Shelley Chapman on March 17 to find that its largest creditor, Dish Network Corp Chairman Charles Ergen, acquired his $850 million stake in the company improperly, according to Reuters. The outcome of the case between the company and Ergen – the closing arguments for which were heard March 17 – is likely to influence the nature of the company’s wireless rights moving forward. LightSquared filed for protection under Chapter 11 of the bankruptcy law not long ago, proposing a plan of reorganization that is contingent upon a favorable ruling in the company’s lawsuit against Ergen.
Dish Network Corp is a direct competitor of LightSquared, and as such would have been barred from acquiring this debt, according to the New York Post. Instead, Ergen himself bought the $850 million controlling share of the company’s senior loan with $700 million of his personal money, a move that was intended to pave the way for Ergen’s company to purchase LightSquared’s spectrum cheaply, the company’s lawyers argue.
LightSquared’s lawyers feel that Ergen should lose his entire stake in the company, according to the news source – a decision which rests with Judge Chapman. Ergen’s lawyer, Rachel Strickland, argues that the mogul shouldn’t lose any of his investment, because he did nothing to damage the company or influence its bankruptcy. She argues that Phil Falcone, one of the company’s chief investors, welcomed the Chapter 11 filing, because it will give him more time as he awaits an FCC resolution that would allow him to retain his equity. Further, Strickland asserts that Falcone manipulated the company’s debt to preserve Ergen’s share in the company’s debt.
“There’s got to be a consequence,” the judge told Ergen, according to the news source. “You know how you tell children there’s a consequence to doing wrong?”
Chapman also had harsh words for LightSquared, according to Reuters.
“No one called 911,” she said. “No one said, ‘Help, there’s a competitor in my capital
- Practices: Corporate Transactions & Business, Bankruptcy & Creditors' Rights, Bankruptcy Litigation
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Scarinci Hollenbeck Expands NYC Real Estate and Litigation Practices ADDING four litigators
NYC Real Estate and Litigation Attorney Ryan O. Miller and Team Join Scarinci Hollenbeck, LLC New York City, NY – August 13, 2025 – Scarinci Hollenbeck, LLC has strengthened its Real Estate and Litigation practices with the addition of four New York City-based attorneys. Ryan Miller, who joins as a partner, is well known for […]
Author: Scarinci Hollenbeck, LLC
What is Business Law and Why Is it Important?
Business law plays a critical role in nearly every aspect of running a successful enterprise, from negotiating a commercial lease to drafting employee policies to fulfilling corporate disclosure obligations. Understanding what is business law and your legal obligations can help your business run smoothly and build productive relationships with clients, business partners, regulators, and others. […]
Author: Dan Brecher
Corporate Transactions: Best Practices for Successful Deals
Corporate transactions can have significant implications for a corporation and its stakeholders. For deals to be successful, companies must act strategically to maximize value and minimize risk. It is also important to fully understand the legal and financial ramifications of corporate transactions, both in the near and long term. Understanding Corporate Transactions The term “corporate […]
Author: Dan Brecher
How to Conduct a Fair and Legal Employee Termination in 2025
Ongoing economic uncertainty is forcing many companies to make tough decisions, which includes lowering staff levels. The legal landscape on both the state and federal level also continues to evolve, especially with significant changes to the priorities of the Equal Employment Opportunity Commission (“EEOC”) under the Trump Administration. Terminating an employee is one of the […]
Author: Angela A. Turiano
Admin Dissolution for Annual Report: What You Need to Know
While filing annual reports may seem like a nuisance, failing to do so can have significant ramifications. These include fines, reputational harm, and interruption of your business operations. In basic terms, “admin dissolution for annual report” means that a company is dissolved by the government. This happens because it failed to submit its annual report […]
Author: Dan Brecher
What Is Antitrust Litigation Law?
Antitrust laws are designed to ensure that businesses compete fairly. There are three federal antitrust laws that businesses must navigate. These include the Sherman Act, the Federal Trade Commission Act, and the Clayton Act. States also have their own antitrust regimes. These may vary from federal regulations. Understanding antitrust litigation helps businesses navigate these complex […]
Author: Robert E. Levy
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.