Agreement to bring Caesars Ent. out of bankruptcy saved by judge
October 06, 2016 11:34 AM
by Robert Mann
A possible derailment of the $5-billion agreement that would bring Caesars Entertainment Corp. out of bankruptcy was thwarted Wednesday when a judge halted a lawsuit against the casino giant.
Most Caesars creditors had said last week that they would drop some of the $13 billion in legal claims against the company. However, a hedge fund with a $9.4 million claim wanted to continue its lawsuit to recover its funds.
The risk that the lawsuit would derail reorganization plans was too great, according to the bankruptcy court in Chicago. The court said an injunction was necessary on all remaining litigation against Caesars to preserve the proposed settlement plan. The injunction could last through a planned January trial that would confirm the plan to get the company out of bankruptcy.
The hedge fund is appealing the injunction and a Dec. 5th hearing has been set.