Lenders to Pay $30MM Settlement to Le-Nature’s Trustee
Law360 reported that a Pennsylvania bankruptcy judge approved a $30 million settlement between bottling company Le-Nature’s and CIT and Krones AG, that allegedly were drawn into the equipment-financing portion of the $668 million fraud that bankrupted Le-Nature’s.
The article said the deal brings in $30 million to the Le-Nature’s trust, reduces CIT’s bankruptcy claim from $132 million to $112 million and postpones any recovery on that claim until the trustee brings in $55 million more in recoveries.
According to bankruptcy court documents, the judge said, “the Krones and CIT settlement agreements are in the best interests of the trust and the creditors of Le-Nature’s and its debtor affiliates, because, among other things; (i) the settlement agreements end over four years of complex, costly, and protracted litigation between the trust on the one hand, and the Krones parties and CIT, on the other, in which the outcome is uncertain; and (ii) under the terms of the settlement agreements, the creditors and the trust will benefit from the elimination of the burden and expense of further litigation against the Krones parties and CIT, and from an infusion of funds to the trustee both to continue his litigation of claims against other defendants and to make distributions to creditors.”
Previously on abfjournal: Compass Settles Le Nature’s Suit Against CIT, Krones, Thursday, November 29, 2012