Tribune Creditors Sue Chairman and JPMorgan for Alleged Fraud
Tribune Co. (TRBCQ) creditors are suing Tribune Chairman Sam Zell and lender JPMorgan Chase (JPM) of misconduct in Zell's $8.2 billion acquisition of the media company in 2007, the Associated Press reported Tuesday.
Creditors, which filed their complaints at the U.S. Bankruptcy Court in Delaware on Monday, are seeking billions in damages from Zell and JPMorgan, according to the AP story.
Zell, a real estate mogul, bought the Tribune Co., which includes the Chicago Tribune, Los Angeles Times and more than 20 broadcast stations, primarily with debt. The company then declared bankruptcy in late 2008, leading to fraud allegations from both former employees and bondholders. Many employees' retirement funds were wiped out in the process.
Tribune is attempting to reorganize, while its CEO Randy Michaels resigned last month amid allegations of workplace hostility.
Tribune representatives didn't immediately respond to a request for comment from AOL Daily Finance.