Judge Blocks WorldCom Stockholder Derivative Suit

Law360, New York (September 27, 2006, 12:00 AM EDT) -- A stockholder’s attempts to target bankrupt WorldCom Inc. in a derivative lawsuit ran into a roadblock on Tuesday when a federal bankruptcy judge refused to allow the action to proceed, ruling that the fallen company’s reorganization plan precludes the claims.

U.S. Bankruptcy Judge Arthur J. Gonzalez of the U.S. Bankruptcy Court for the Southern District of New York on Tuesday denied a motion by Frank David Seinfeld seeking permission to prosecute a stockholder’s derivative action in district court and in the U.S. Court of Appeals for...
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