In re: Tribune Co. Fraudulent Conveyance Litig.

Appellants, representatives of certain unsecured creditors of the Chapter 11 debtor Tribune Company, appealed the grant of a motion to dismiss their state law, constructive fraudulent conveyance claims brought against Tribune’s former shareholders. The court held that appellants are not barred by the Bankruptcy Code’s automatic stay because they have been freed from its restrictions by orders of the bankruptcy court and by the debtors’ confirmed reorganization plan. The court also held that appellants’ claims are preempted by Bankruptcy Code Section 546(e), where that section shields from avoidance proceedings brought by a bankruptcy trustee transfers by or to financial intermediaries effectuating settlement payments in securities transactions or made in connection with a securities contract, except through an intentional fraudulent conveyance claim. Accordingly, the court affirmed the judgment. View "In re: Tribune Co. Fraudulent Conveyance Litig." on Justia Law