2nd Circuit Rejects LightSquared Chapter 11 Appeal by Former CEO
The 2nd Circuit U.S. Court of Appeals upheld LightSquared's Chapter 11 bankruptcy reorganization plan, shooting down an appeal by former LightSquared CEO Sanjiv Ahuja, who was a major stakeholder in the company. In a summary order Tuesday, the 2nd Circuit…
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rejected Ahuja's argument the plan wasn't fair because it overpaid some senior creditors with undervalued equity in the reorganized company, saying the court's conclusion "was premised on extensive factual findings, including ... the significant regulatory risks involved." The 2nd Circuit also rejected his argument of unequal treatment, saying the plan canceled the interests of all common equity holders, and Harbinger Capital received value for its secured claim, not its common equity interests.