US Bankruptcy Judge Kevin Carey has heard the arguments for the two competing reorganization plans for Tribune Company and can’t make up his mind. So the 27-month old Chapter 11 case could stretch on…and on.
“The parties are stuck,” the judge said, according to the latest report by the company’s flagship Chicago Tribune. Carey said he see strengths and weaknesses in both of the competing plans – one from senior creditors and backed by Tribune Co. management and the other from junior bondholders led by Aurelius Capital – and warned the parties that he might not confirm either plan. That may have been a warning to the warring factions that they had better get back to the bargaining table.
If no agreement is reached on a single plan, Carey could hold a hearing to appoint a Chapter 11 trustee to resolve the case. That would add months and months to the already drawn out and expensive litigation.