Former Appvion Inc. executives and advisers have been accused in a lawsuit of cherry-picking financial data that inflated the value of the paper maker’s now-worthless employee stock plan as the company skidded to bankruptcy, WSJ Pro Bankruptcy reported. The civil lawsuit seeks to recover money for current and former Appvion workers who invested in an employee stock ownership plan that was wiped out in bankruptcy. The legal action was brought by a trust created by the company’s chapter 11 plan, approved by a judge earlier this year. A version of the lawsuit, which is partially redacted, was filed yesterday in Wilmington, Del. Trustees Alan D. Halperin and Eugene I. Davis contend former Appvion directors and senior management were motivated in the years before the company filed for bankruptcy in October 2017 to present “fantastical” financial projections to advisers because their compensation packages were tied to the valuation of the business.
