Adelphia Creditors Seek To Cut Off Defense Funds

Law360, New York (May 1, 2006, 12:00 AM EDT) -- Creditors of Adelphia Communications Corp. have requested a bankruptcy court to restrict the flow of company funds to lenders for defense expenses regarding loans to the cable provider prior to its bankruptcy.

Adelphia’s official committee of unsecured creditors estimated that Adelphia’s lenders have already taken in approximately $100 million for indemnification claims and should not receive additional funds, according to court documents filed Friday.

Six banks claim they are awaiting a total repayment of $6.8 billion in principal under financial deals made before Adelphia filed for...
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