Capmark Unsecured Creditors Attack Deal With Lenders

Law360, New York (October 15, 2010, 6:47 PM EDT) -- Unsecured creditors in Capmark Financial Group Inc.’s bankruptcy argued Friday that the debtor is overpaying for a mortgage pool in a proposed $975 million settlement with secured lenders on a $1.5 billion loan.

The official committee of unsecured creditors made its case at an evidentiary hearing in the U.S. Bankruptcy Court for the District of Delaware that the debtor erred in swapping unsecured debt for the secured loan in May 2009 and is doubling down on that mistake in the proposed settlement.

The settlement will essentially...
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