This 'has all been a model for advocacy' as Judge Lifland has said, and appears to be a systemic method obliterating equity,
New York (PRWEB) January 17, 2008
Bankruptcy Judge Burton Lifland, US Bankruptcy Court Southern District (re: Calpine Case No 05-60200) in lower Manhattan tells shareholders to "get lost," effectively denying dissident shareholders of Calpine Corporation any relief in their request for reconsideration of the plan confirmation the judge approved December 19, 2007 allowing the company to emerge from bankruptcy.
In a hearing on January 15, 2008, Judge Lifland read from a prepared statement, his Order of Denial after hearing oral arguments from dissenting shareholders and the objecting creditors and debtor, Calpine.
Dissenting shareholders included four (4) hedge funds and one shareholder: Compania Internacional Financiera, Coudree Global Equities Fund, Standard Bank of London, Leonardo Capital Fund and shareholder, Elias Felluss.
The shareholders contended in court they were relying on the official equity holders' committee to present their valuation estimates. Apparently the equity committee reported on Monday, December 17, 2007 that a deal had been struck. During the Monday testimony, Bridges, the court appointed appraiser; announced shareholders had capitulated during private Sunday negotiations, yielding to demands "under the power of this court".
The expectation of a contentious valuation proceeding was reduced to a whimper.
"The Judge explained 'in his denial order, shareholders had every right to object if they knew of the secret deal,' is a laughable ruling, something Judge Yogi Berra would have found," says longtime shareholder Kurt Giehler, Prospect Heights, IL.
An appeal is likely and imminent reported Ms Carole Neville, an attorney with SONNENSCHEIN NATH & ROSENTHAL, the lead attorneys in petitions to reconsider.
As the Calpine Company executives and management award themselves 3% of the new company, they tell shareholders "to go fish, like blind pigs at the trough they cannot see the devastation they administer," says Felluss, "and may be met with 'Lions at the Gate'."
This Calpine bankruptcy has been nothing more than a refinancing scheme where old contracts and unproductive assets are jettisoned. A forensic examination will prove the Calpine management and Creditors have taken a solvent company and through bankruptcy gave the appearance of insolvency. Meanwhile, shareholders have their equity stake eviscerated by hedge fund Harbinger, the objector who joined Calpine's objection to bar the shareholders motion to reconsider," said Elias Felluss, a dissenting shareholder of Centerport, NY.
"This 'has all been a model for advocacy' as Judge Lifland has said, and appears to be a systemic method obliterating equity, " said shareholder Felluss, who is also the spokesperson for the Calpine Shareholder's Committee, representing some 200 shareholders.
"It does seem odd to me," he continued, "that a shareholder's plea for fairness should be met by an "objection" from the very company in which he has shares. It certainly sounds like the mailman is biting the dog...and biting hard. Creditors are owed a contractual obligation by the Debtors, not a fiduciary."
Examination of the public record suggests there is every appearance some creditors, together with the debtors conspired to keep shareholders in the dark.
On occasion, there have been times when individuals go to great lengths to defend a particular position in which they believe. If the clients of Sonnenshein and Mr. Felluss, feel they have been wronged, the return on investment will no longer be the overriding issue.
It will now be one of seeing justice served.
In his oration Judge Lifland said, "Don't complain to this court about the rules Congress provides me to enforce....take it up with your Congressman."
"It is an affront to juris for Judge Lifland to assign responsibility to Congress for his failure to find justice. The timetable set by creditors should not make subservient the desire for all classes to find fairness," said Felluss.
As the US Presidential campaign gets underway, neither Democrat nor Republican candidates have addressed the issue of Wall Street's disembowelment of "Main Street" investors.
With Enron, Kmart, Worldcom debacles fresh in many memories, the court enabled foreclosure of investors' equity moves along at full speed.
As candidates discuss amendments to the constitution, which voted for what, tax reductions, Wall Street unimpeded, routinely swipes the milk from investors' coffee, and occasionally, the entire cup.
The promises for the future dashed, only to find new cars in the driveways of their bankers.
for more info contact: Calpine Shareholders Committee: