Accredited Creditors Say Deal Will Tank Insurance

Law360, New York (August 18, 2009, 1:42 PM EDT) -- Accredited Home Lenders Holding Co.’s $22 million settlement in a long-running securities class action should not get approved until after the company files its liquidation plan — or should be rejected altogether — because the deal would exhaust AHL's insurance coverage, the committee of unsecured creditors has said.

In a motion filed Monday in the U.S. Bankruptcy Court for the District of Delaware, the unsecured creditors said approval of the settlement would be “premature and risky.” Because the class settlement would be subordinated to general unsecured...
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