Hedge Funds Demand $2M From Tower Auto

Law360, New York (June 27, 2007, 12:00 AM EDT) -- Three hedge funds that previously reneged on a $250 million rights offering for bankrupt auto parts maker Tower Automotive Inc. have demanded $2 million in unreimbursed fees and expenses.

Strategic Value Partners LLC, Wayzata Investment Partners LLC and Stark Investments LP on Monday asked the U.S. Bankruptcy Court in Manhattan to require Tower to pay the costs they incurred conducting due diligence for the underwriting.

“By providing unequivocal assurances of eventual payment, the debtors made a promise to the backstop parties that induced reasonable reliance by...
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