Mortgage Lenders former CEO, company counsel clarify wording of prosecution injunction motion

By Caroline Salls

Pittsburgh, April 10 - Mortgage Lenders Network USA, Inc. former chief executive officer Mitchell Heffernan entered a stipulation with the company's counsel to clarify a portion of Heffernan's motion to keep the state of Connecticut from prosecuting him, according to a Tuesday filing with the U.S. Bankruptcy Court for the District of Delaware.

Under the stipulation, the affidavit in support of Heffernan's motion will be supplemented to reflect that Mortgage Lenders' counsel James I. Stang, of Pachulski Stang Ziehl Young Jones & Weintraub LLP, advised the company generally on the impact of its obligations to employees and to pay employee benefits and the risks associated with payment and non-payment of pre-bankruptcy employee benefits.

However, according to the stipulation, Stang did not advise the company to pay or not pay employee brokerage commissions.

Mortgage Lenders Network, a Middletown, Conn.-based lending company, filed for bankruptcy on Feb. 5. Its Chapter 11 case number is 07-10146.

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