Hedge Funds Lose Bid To Appoint Trustee Over Patriot Coal

Law360, Chicago (May 13, 2013, 3:56 PM EDT) -- A Missouri bankruptcy judge on Friday rejected an effort by two hedge funds to install a trustee to oversee Patriot Coal Corp.'s Chapter 11 case, spurning the notion that some of Patriot’s affiliates can reorganize without getting dragged into a messy fight with the miners’ union.

Aurelius Capital Management LP and Knighthead Capital Management LLC, both bondholders of St. Louis-based Patriot, failed to show cause for such a drastic remedy and didn’t demonstrate that it would benefit the company’s creditors, according to an order signed by...
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