Creditors file $1.6M claim against Tribune CFO

By Tribune staff report
Posted Dec. 3, 2010 at 12:45 p.m.

By Michael Oneal and Becky Yerak | The unsecured creditors’ committee in Tribune Co.’s bankruptcy case has filed the first of what’s expected to be about 210 individual claims against current and former officers and directors of the Chicago-based media company seeking to claw back close to $180 million in so-called “preference payments” they collected.

The first claim, filed in U.S. Bankruptcy Court in Wilmington, DE., targeted Chandler Bigelow, Tribune Co.’s chief financial officer. It seeks recovery of more than $1.6 million in compensation he was paid in December 2007 when he was the company’s treasurer, including a $400,000 bonus and $880,645 in restricted stock.

Claims targeting other Tribune Co. officials will follow, sources said.

The claims stem from a provision in the U.S. bankruptcy code that allows the estate to seek recovery of payments made to satisfy pre-existing obligations any time 90 days before the company made its initial bankruptcy filing (one year back in some cases).

At a recent hearing, U.S. Bankruptcy Judge Kevin Carey gave the creditors’ committee the go-ahead to file the claims, which the committee said total around $180 million. It also plans to file claims seeking to recover fees paid to professionals hired to help with the company’s ill-fated 2007 leveraged buyout. Those payments totaled $18 million.

The filings are to some extent a formality at this point. Although the claims are real, they have been stayed by the court pending the outcome of the current restructuring plan process. The committee filed them now because there is a two-year statute of limitations on such claims that expires Dec. 8, the two-year anniversary of Tribune’s original 2008 filing.

“The company is hopeful that these claims will be resolved during the course of the Chapter 11 process,” said Gary Weitman, a spokesman for Tribune Co., which owns the Chicago Tribune, Los Angeles Times and other media assets.

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