Delphi Probes Report Of 'Inappropriate' Shorting

Law360, New York (March 18, 2008, 12:00 AM EDT) -- Delphi Corp. may now use subpoenas to investigate allegations that some proposed investors in a $2.55 billion equity investment, a crucial part of the auto parts maker's financing for exiting Chapter 11, have been shorting outstanding Delphi stock.

On Monday, Judge Robert D. Drain of the U.S. Bankruptcy Court for the Southern District of New York approved Delphi's request for subpoena power over all proposed investors in the equity plan as part of its investigation.

Delphi has said it has received reports that at least one...
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