We use cookies on this site to enable your digital experience. By continuing to use this site, you are agreeing to our cookie policy. close

Musicland's Creditors Sue Banks Over $25M Loan

Law360 (May 16, 2007, 12:00 AM EDT) -- A group of entertainment companies have sued two banks over a last-minute $25 million loan paid to Musicland Holding Corp. four months before the retailer filed for bankruptcy.

The eight secured trade creditors, which include Buena Vista Home Entertainment Inc. and Paramount Pictures Corp., claim the banks—Harris N.A. and Wachovia Bank N.A.—participated in a “subterfuge” to disguise the loan as part of a revolving credit facility secured by a senior claim on all of Musicland’s assets at the creditors' expense.

The funds, which were repaid to...
To view the full article, register now.
Law360 Pro Say Podcast
Check out Law360's new podcast, Pro Say, which offers a weekly recap of both the biggest stories and hidden gems from the world of law.