Avenue Stores Lender Backs Converting Case To Chapter 7

Law360 (November 20, 2019, 7:12 PM EST) -- A lender to insolvent retail chain Avenue Stores Inc. told a Delaware court Wednesday the company's bankruptcy case should be converted to a Chapter 7, saying the move would expose what it said were baseless claims against it by Avenue Stores' unsecured creditors.

In a response to Chapter 7 conversion motions filed by the unsecured creditors committee and the U.S. Trustee’s Office, second-lien lender Ornatus URG Holdings LLC and affiliate Versa Capital Management said they were also in favor of a conversion. They said they expected the trustee would pursue $37 million in clawbacks from unsecured creditors rather than what they...

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