Innovative Communication creditors ask court to unseal involuntary case settlement terms

By Caroline Salls

Pittsburgh, July 19 - Several Innovative Communication Co. creditors asked the U.S. Bankruptcy Court for the District of Delaware to unseal terms of a proposed settlement agreement that would help resolve the involuntary Chapter 11 filing against Innovative, according to a Wednesday court filing.

The creditors, D.E. Shaw Laminar Lending, Inc.; Fir Tree Recovery Master Fund, LP; Fir Tree Value Master Fund, LP; Redwood Domestic Fund, LP; York Capital Management, LP; and York Distressed Opportunities Fund, LP, also asked the court to postpone a July 26 hearing on the proposed settlement to give them time to review the documents once unsealed.

According to the motion, the bankruptcy code requires disclosure and adequate notice to ensure companies in involuntary proceedings treat all creditors and parties in interest fairly, not just those that filed the bankruptcy petition.

The creditors said on June 12 the court ordered Innovative to provide "broad notice" of the motion for approval of the settlement, which the creditors did not receive.

In addition, the creditors said the non-settling unsecured creditors have a right to receive all information in connection with the bankruptcy proceedings so they can preserve their claims by actively participating in the case.

If the settlement terms are not unsealed, the creditors said unsecured creditors will not be able to make an informed decision on whether to dismiss the involuntary case.

Since Innovative allegedly owes about $650 million to parent Greenlight Capital Qualified LP, which filed the involuntary petition, the creditors said the settlement most likely "involves hundreds of millions of dollars."

In a separate filing, Innovative said it has been negotiating with several lending institutions to obtain financing required under the proposed settlement, and the company believes it is on the verge of entering into a definitive commitment for financing with one or more of the lenders in the next few days.

Innovative, a St. Croix, U.S. Virgin Islands, holding company, had the involuntary bankruptcy petition filed against it on Feb. 10. Its Chapter 11 case number is 06-10133.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.