Judge Spikes Investor Appeal of Abitibi's Ch. 11 Plan

Law360, Wilmington (April 9, 2013, 10:55 PM EDT) -- A Delaware federal judge on Tuesday nixed a shareholder's appeal of AbitibiBowater Inc.’s confirmed Chapter 11 plan, rejecting the proposal that investors should receive a 5 percent distribution of common stock from the now-reorganized paper giant as inequitable.

Investor Peter I. Shah had challenged the bankruptcy court's November 2010 approval of AbitibiBowater's reorganization plan, claiming a proper valuation would have put shareholders in the money instead of extinguishing their equity, but U.S. District Judge Leonard P. Stark granted the company's motion to dismiss.

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