Tribune Creditors Sue Former Publisher of Newsday Over Payments
Tribune Co. creditors sued Timothy P. Knight, the former publisher of Newsday, seeking to recover payments he received before the company collapsed and filed for bankruptcy almost two years ago.
The official committee of unsecured creditors wants to recoup payments that Knight received in December 2007 and August 2008 totaling about $7.4 million, according to the complaint filed today in U.S. Bankruptcy Court in Wilmington, Delaware.
The complaint is the latest in a series of lawsuits that began last week after Judge Kevin J. Carey gave creditors authority to sue to recover payments to so-called insiders. It follows at least 18 others filed by the creditors against current and former executives, including former Chief Executive Officer Dennis FitzSimons.
Gary Weitman, a Tribune spokesman, and Adam G. Landis, a lawyer for the creditors, didn’t immediately return e-mails seeking comment. Knight couldn’t be immediately reached for comment.
Tribune, publisher of the Los Angeles Times and the Chicago Tribune newspapers, filed for Chapter 11 protection in December 2008, a year after a buyout led by real estate developer Sam Zell saddled the company’s with about $8 billion more debt.
The four disclosure statements, documents describing the competing proposals submitted by four groups of creditors hoping to reorganize the company, are due tomorrow. The plans differ on how to resolve allegations over the 2007 buyout.
The bankruptcy case is In re Tribune Co., 08-13141, and the Knight case is In re The Official Committee of Unsecured Creditors of Tribune v. Timothy P. Knight, 10-55956, U.S. Bankruptcy Court, District of Delaware (Wilmington).
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