Harbinger Fights LightSquared Lender Bid To Sue It

Jan 11 2013 | 12:03pm ET

Harbinger Capital Partners and founder Philip Falcone won a small victory this week as they try to block creditors of Harbinger's largest investment from suing them.

Those lenders, including Mast Capital Partners and Fortress Investment Group, sought permission to sue Harbinger, Falcone and U.S. Bank in September and pressed their case on Wednesday. But U.S. Bankruptcy Court Judge Shelley Chapman said that she would not rule until after the end of this month, when LightSquared, the Harbinger-owned wireless Internet company, will seek to maintain exclusive control of its bankruptcy process.

The LightSquared creditors have asked for the right to sue Harbinger, Falcone and U.S. Bank on behalf of LightSquared, which they say will "not sue their controlling insider." In particular, the creditors have taken issue with a $263.8 million loan Harbinger made to LightSquared, which they say was really an equity infusion.

Harbinger and U.S. Bank say that the lenders have no standing to sue them as "creditors of a creditor."

"There are a lot of complicated issues," Chapman said, without indicating which way, if any, she was leaning.


In Depth

Fundraising for Mid-Sized PE Funds: Should You Use a Registered B/D?

Dec 6 2016 | 7:18pm ET

When does a fund sponsor need to use a registered broker/dealer when raising capital...

Lifestyle

Trump Attends 'Villains and Heroes' Costume Party Dressed As...Himself

Dec 5 2016 | 11:16pm ET

U.S. President-elect Donald Trump attended a "Villains and Heroes" costume party...

Guest Contributor

Nowhere to Hide: Why the Future of Asset Management Depends on Innovation

Nov 15 2016 | 6:55pm ET

Information technology has reshaped the asset management industry’s periphery,...

 

From the current issue of

Since the inception of Modern Trader, a core editorial theme has centered on the wisdom and power of crowds. Editorial emphasis has focused on companies and projects engaged in the collection and analysis of information. 

AVAILABLE NOW at BARNES & NOBLE

NEWSTAND LOCATOR