Lehman U.S. Trustee objects to equity committee appointment request

By Caroline Salls

Pittsburgh, Oct. 10 - Lehman Brothers Holdings, Inc.'s U.S. Trustee objected to a motion for appointment of an official committee of equity holders for the company's Chapter 11 bankruptcy case, according to a Friday filing with the U.S. Bankruptcy Court for the Southern District of New York.

According to the objection filed by U.S. trustee Diana G. Adams, committee appointment proponent Greg Georgas has failed to prove that appointment of an official equity committee is necessary to adequately represent equity holders in Lehman's bankruptcy case.

In addition, Adams said Georgas' motion is based primarily on a statement made in a Sept. 10 press release, with Georgas arguing that the fact that there was $28.4 billion of shareholder equity in Lehman Brothers justifies appointment of the committee.

"Reliance upon information from a press release is not sufficient to demonstrate that there is an economic interest to be protected," Adams said in her objection.

Adams also said Georgas, an individual, is the only person who has requested appointment of an equity committee for the case. Adams said the company's shareholders already have a voice in its Chapter 11 proceedings.

New York-based Lehman Brothers Holdings is the fourth largest investment bank in the United States. The company filed for bankruptcy on Sept. 15. Its Chapter 11 case number is 08-13555.

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