Creditors Claim Magna Heads Threw Co. Under Bus

Law360, New York (July 23, 2009, 12:10 AM EDT) -- The unsecured creditors in the Magna Entertainment Corp. Chapter 11 bankruptcy proceedings have filed an adversary case against majority shareholder MID Islandi, alleging that its management left creditors in limbo by failing to sell Magna’s marketable assets and doling out unnecessary loans as the company continued to sink.

The official committee of unsecured creditors filed the complaint Tuesday in the U.S. Bankruptcy Court for the District of Delaware, arguing that MID Islandi and its subsidiary MI Developments Inc. operated a “heads I win, tails you lose”...
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