Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comFirm Insights
Tribune Co. to Drop Certain Clawback Lawsuits Against Executives
Author: Joel R. Glucksman
Date: February 7, 2013
Key Contacts
Back
Clawback Lawsuits to be Dropped, but NOT for all Executives
The Tribune Co., owner of several notable newspapers and television stations, announced that it plans to drop some lawsuits against the executives that it asserts contributed to its bankruptcy.
Following upon its recent emergence from bankruptcy protection, the company said it plans to drop the majority of its 170 lawsuits against senior media executives who profited from the privatization of Tribune Co. The leveraged buyout undertaken by Sam Zell in 2007 eventually forced the Tribune Co. to file for Chapter 11 protection under bankruptcy law. Following the company’s collapse, it sued several executives whom it argued had misinterpreted key facts in order to complete the sale with Zell.
The Tribune Co. relied on a report written by bankruptcy examiner Kenneth Klee, who was commissioned by the court to help the company navigate its proceedings. In the report, Klee wrote that the company’s executives were unrealistic when they calculated the company’s 10-year projections, and that they also failed to inform the board of the risks involved with the sale, according to the Chicago Tribune. The report also noted that it was likely executives had engaged in “intentional fraudulent conveyance” that not only left the company facing insolvency, but may have also been intentionally done in order to “hinder, delay or defraud” creditors, the Tribune added. In response to the report, many creditors – such as Aurelius Capital Management – campaigned for larger settlements, and the company itself sought to claw back tens of millions in payments executives had received following the close of the deal.
Not all lawsuits will be dropped, however, and many high-level executives will continue to face clawback litigation. This includes the lawsuit against former Chief Executive Dennis FitzSimons, who pocketed $47 million out of the deal, according to Dow Jones Newswires.
The Tribune Co. emerged from bankruptcy on December 31, nearly four years after its initial filing.
- Practices: Bankruptcy & Creditors' Rights, Corporate Transactions & Business, 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
You Just Received a Federal Grand Jury Subpoena in New Jersey: Now What?
Receiving a federal grand jury subpoena is not something most businesses or individuals anticipate. While it can be concerning, a federal grand jury subpoena does not necessarily mean that you are being accused of wrongdoing. It does, however, mean that a federal criminal investigation is underway and that federal prosecutors believe you may possess information […]
Author: George McGowan
Why Every Business Should Conduct an Annual Insurance Coverage Review
Most New Jersey business owners purchase insurance policies, file them away, and assume they are protected if a claim arises. Without a regular insurance coverage review, many companies discover gaps only after a lawsuit, cyberattack, property loss, or other significant event occurs. An annual insurance coverage review can help businesses identify potential risks, ensure their […]
Author: George McGowan
Demand Letters & Cease and Desist Letters: When to Send One (and When Not To)
Businesses and individuals often encounter situations where another party breaches a contract, fails to pay a debt, or continues harmful conduct. In many such disputes, a precisely drafted demand letter or cease-and-desist letter serves as a powerful legal tool. It can frequently resolve the dispute and avoid litigation. While demand or cease-and-desist letters can resolve […]
Author: George McGowan
How to Effectively Use Contracts to Manage Risk
Key provisions in your contracts, including those relating to indemnification, insurance, and defense, are essential to contract risk management. While sometimes considered “boilerplate,” these provisions play a pivotal role when determining which party is responsible for certain costs and liabilities. They must always be negotiated and drafted carefully. Indemnification Clauses Businesses should never overlook the […]
Author: George McGowan
Understanding Portability for Estate and Gift Tax
Portability of estate and gift tax enables a surviving spouse to inherit any unused portion of their deceased spouse’s federal estate and gift tax exemption. So, if one spouse doesn’t utilize their full exemption, the surviving spouse can effectively double their exemption amount with regard to estate tax liability. For married couples, portability offers a […]
Author: Marc J. Comer
Pet Trusts in New Jersey and New York: A Practical Estate Planning Tool
For many of us, pets are more than companions—they are members of the family. Yet they are often overlooked or inadequately provided for when it comes to estate planning. A pet trust offers a legally enforceable way to ensure that your animal continues to receive proper care if you become incapacitated or pass away. As […]
Author: Marc J. Comer
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.