A court filing shows that a key Cenveo Inc. creditor has threatened to “dig under every rock to find ‘dirt’ on” the family that controls the bankrupt commercial printer unless second-lien bondholders come out better than expected in the chapter 11 proceedings, WSJ Pro Bankruptcy reported. Earlier this month, Brigade Capital Management LP called for an examiner to be appointed to investigate the propriety of Cenveo’s prearranged bankruptcy plan. The New York-based investment firm, which has stakes in both Cenveo’s top-ranking and second-lien bonds, said it doesn’t support the company’s debt-cutting proposal. Brigade says it is unhappy about “potential insider transactions” that could benefit the family that runs the public company, among other things. Cenveo on Tuesday filed a response with the U.S. Bankruptcy Court in White Plains, N.Y., saying that Brigade and its advisers have repeatedly said that, if Brigade does not recoup enough on its second-lien debt, then it would “embroil the company in costly litigation.” Cenveo filed for chapter 11 protection earlier this month after reaching a deal with most of its other top-ranking lenders, who are set take control of the company.
