Former shareholders of Tribune Co. — the bankrupt owner of the Chicago Tribune and Los Angeles Times — were sued Thursday by a Deutsche Bank AG unit and retirees over claims the media company’s $8.5 billion leveraged buyout in 2007 was a fraudulent transfer that pushed it into bankruptcy.
The case was filed in U.S. District Court in Denver because three of the named shareholder defendants are Colorado residents. Several other similar cases against named shareholders were filed in federal courts in at least 11 states.
Those creditors and others in the lawsuit are owed at least $2.5 billion that can’t be repaid in full because of the 2007 deal, Deutsche Bank Trust Company Americas said in its complaint.
The Tribune bankruptcy is still before a federal judge in Delaware. Though the judge gave permission for Deutsche to file the suits, he immediately stayed them all.
