Mexican Media Brands
Creditor Lawsuit Could Cost GM Nearly $1 Billion
A lawsuit by General Motors Co. bondholders could cost the company as much as $918 million, CFO Dan Amman tells a U.S. bankruptcy court.
#legal
Share
A lawsuit by General Motors Co. bondholders could cost the company as much as $918 million, CFO Dan Amman tells a U.S. bankruptcy court.
The company also says a victory for the plaintiffs could create a "chaotic situation" for GM because agreements that were settled years ago in bankruptcy could come unraveled.
The plaintiffs claim the company gave some creditors more favorable treatment in the days leading up to GM's June 2009 Chapter 11 filing. They allege the company made a sweetheart deal with GM Canada's bondholders, thus leaving less money for other creditors.
The maneuvering was part of GM's effort to keep its Canadian unit out of bankruptcy.
The Canadian bondholders dismiss the claims as "pure fabrication."
Amman, who became GM's finance chief in April 2011, was advising the company in 2009 as an investment banker at Morgan Stanley. He helped negotiate the Canadian bond deal.
RELATED CONTENT
-
Court Ruling Exposes GM to Punitive Damages Over Ignition Switches
A new ruling by the federal judge who presided over General Motors Corp.’s 2009 bankruptcy could expose post-bankruptcy General Motors Co. to a wave of costly punitive damage awards linked to the company’s defective ignition switches.
-
Former VW Exec Schmidt Gets Maximum Sentence in Diesel Scandal
Oliver Schmidt—the former Volkswagen AG executive who pleaded guilty in August to lying about VW’s diesel pollution cheating—has received the maximum sentence of seven years in prison and a $400,000 fine.
-
China Prepares to Sanction U.S. Carmaker for Price Fixing
China is preparing to fine an undisclosed U.S. carmaker for ordering its distributors to fix prices beginning in 2014, according to China Daily. Media reports say General Motors Co. is the target.