Philip Falcone’s LightSquared Inc. won a judge’s approval to marginalize a $1 billion debt claim by Dish Network Corp. Chairman Charles Ergen, a key to the wireless broadband company’s ability to leave bankruptcy under a proposed reorganization plan, Bloomberg News reported yesterday. Ergen’s claim will be put behind other creditors by an amount to be determined after further proceedings, Bankruptcy Judge Shelley Chapman said at a hearing yesterday as she prepared to rule on LightSquared’s plan to reorganize with $2.5 billion in financing backed by Fortress Investment Group LLC, JPMorgan Chase & Co. and Melody Capital Advisors LLC. LightSquared accused Ergen of secretly snapping up debt in the company to hijack its reorganization and get its airwaves at a discount. The company said that, as a rival, Ergen was barred from owning the debt in the first place and his claim could be singled out for worse treatment than that of other creditors.
