Sun Capital Partners is trying to get tossed out a landlord lawsuit accusing the private-equity firm of diverting funds from defunct general merchandise chain ShopKo, WSJ Pro Bankruptcy reported. The Boca Raton, Fla.-based buyout firm said a settlement reached with creditors during the retailer’s bankruptcy protects it from legal action. It added that the landlords, as individual creditors, don’t have the standing to make the allegations stated in the lawsuit. Allegations against Sun Capital in the federal lawsuit, filed in May in Florida by landlords for nine stores, include common law fraud, unjust enrichment and conspiracy to violate the Racketeer Influenced and Corrupt Organizations Act. The landlords alleged that Sun Capital diverted funds away from ShopKo, resulting in the merchant’s bankruptcy and harming property owners in the process.
