March 19, 2011 – CHICAGO (Reuters) - A judge said the Tribune Co.. bankruptcy case was deadlocked after two weeks of testimony in a federal court, the Chicago Tribune newspaper reported on Saturday.
Judge Kevin Carey, who is overseeing the case in Wilmington, Del., also warned on Friday that the case may be given to a Chapter 11 trustee if the company's creditors could not reach an agreement soon. The hearings were not expected to conclude until April.
The company filed for bankruptcy protection in 2008, citing declining advertising revenue and a credit crisis that made it difficult to support its debt.
It backs a plan that would settle legal claims among the parties to the bankruptcy, which would see lenders ending up owning the company and bondholders receiving at least about 34 cents on the dollar.
A Tribune Co. spokesman declined to comment on the story on Saturday.
The bankruptcy case pits lenders JPMorgan Chase & Co., hedge funds Angelo Gordon & Co. and Oaktree Capital Management against a group of bondholders led by Aurelius Capital Management who want to establish a trust that would fund the pursuit of additional legal claims stemming from a 2007 buyout.
(Reporting by Suzanne Cosgrove; Editing by Paul Simao)