Dec 3, 2008 8:54 am US/Eastern
Former Shareholders Want $4.1M From Trump Casinos
ATLANTIC CITY, N.J. (CBS/AP) ―
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Atlantic City casinos are working to avoid a drop in business in December. (file)
CBS
Seventeen former Trump casino shareholders want $4.1 million from a bankruptcy settlement between the company and stock investors.
The shareholders on Monday asked a federal bankruptcy court to liquidate the three Trump casinos if they don't pay up in five days.
A lawyer for Trump Entertainment Resorts says the former shareholders sold their stock and are trying to get money they don't deserve.
"What these 17 are trying to do, to use a nontechnical term, is double dip, because when they sold the stock, they got their money," Robert M. Pickus, the company's general counsel, told The Press of Atlantic City for Wednesday's newspapers.
The dispute dates back to 2005, when Donald Trump's former casino company, Trump Hotels & Casino Resorts Inc., went through Chapter 11 bankruptcy restructuring and came out as a new corporation, Trump Entertainment Resorts.
As part of the deal, Trump agreed to pay eligible shareholders a settlement that consisted of new stock warrants, $17.5 million in cash and $25.1 million from the sale of the old Trump World's Fair Casino site.
The 17 former shareholders claim they were wrongly excluded from the deal.
In April 2007, a federal judge ruled in their favor, and sent the matter back to the bankruptcy court for further consideration. A federal appeals court upheld that ruling last month.
(© 2009 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)
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