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Lehman creditor group objects to proposed exclusivity extension
By Jennifer Lanning Drey
Portland, Ore., July 10 - An informal group of Lehman Brothers Holdings Inc. creditors objected to the company's motion for an eight-month extension to its exclusive periods to file a plan of reorganization and solicit votes on the plan, according to a Friday filing with the U.S. Bankruptcy Court for the Southern District of New York.
The creditors said the company's managers, advisers, board of directors and equityholders are not economically motivated to create value for the estate.
"These cases require a plan that allows creditors immediately to control their destinies and maximize recoveries for themselves," the group said.
In addition, the creditors said Lehman has claimed there is cause to extend the exclusive periods but failed to articulate what purpose it would provide.
The group said because the company will be liquidating its assets over what may take many years, any proposed plan will be a Chapter 11 liquidating plan.
"In a liquidation such as this, Congress made clear that it recognizes that creditors should determine their destinies," the creditors said in the filing.
As previously reported, Lehman wants to extend its exclusive plan-filing period to March 15, 2010 from July 13 and the solicitation period to May 17, 2010 from Sept. 16.
The company said the additional time is necessary due to the sheer size and complexity of the cases.
A hearing is scheduled for July 15.
New York-based Lehman Brothers Holdings was the fourth largest investment bank in the United States. The company filed for bankruptcy on Sept. 15, 2008. Its Chapter 11 case number is 08-13555.
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