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LightSquared says that it was right to keep Dish Network Corp. Chairman Charlie Ergen out of its restructuring plans, claiming it is "not required to negotiate with a competitor in its capital structure" even if that competitor owns nearly $1 billion of the company's debt, the Wall Street Journal reported today. In a Saturday filing with U.S. Bankruptcy Court in Manhattan, lawyers for Philip Falcone's wireless venture continued making their case that the reorganization plan is fair to Ergen, LightSquared's top secured lender. "There is simply no doubt that [Ergen] is receiving the indubitable equivalent of its claim," LightSquared said in a filing. Ergen has argued that LightSquared's proposal to pay back his nearly $1 billion in bank debt over seven years via a note, rather than in cash like a group of hedge funds that own the same type of debt, violates the Bankruptcy Code.

Philip Falcone’s LightSquared Inc. will borrow an additional $74 million from existing lenders to stay alive in bankruptcy after saying that it is running out of cash and may fail to reorganize without more funds, Bloomberg News reported yesterday. Bankruptcy Judge Shelley Chapman approved the wireless-spectrum owner’s loan agreement yesterday. Lenders, including a fund controlled by Dish Network Corp. Chairman Charles Ergen, will have priority rights to be repaid on the new loans. A prior order called for LightSquared to borrow as much as $80 million.

Dish Network Corp. Chairman Charles Ergen, the largest creditor of bankrupt wireless company LightSquared, is seeking permission to sue Phil Falcone, the investor whose Harbinger Capital fund controls LightSquared, Reuters reported on Friday. In a court filing on Friday, Ergen asked the judge overseeing LightSquared's chapter 11 case for permission to bring a lawsuit alleging Falcone mismanaged the company, focusing on preserving his own investment at the expense of other stakeholders. LightSquared, majority-owned by Harbinger, went bankrupt in 2012, when the Federal Communications Commission revoked its license to operate spectrum out of concern it could interfere with GPS systems. Ergen then acquired about $1 billion of the company's senior loan debt, giving him a controlling stake in LightSquared's capital structure.

Investor Phil Falcone, whose Harbinger Capital Partners owns bankrupt wireless company LightSquared, said yesterday that he always intended to cut the debt claims of LightSquared's largest creditor, Dish Network Corp. Chairman Charlie Ergen, Reuters reported yesterday. LightSquared is seeking court approval of its plan to exit bankruptcy and repay creditors. The plan would pay most lenders in cash while paying Ergen in the form of a long-term note, terms to which Ergen has objected. Under intense questioning from Ergen's attorneys, Falcone acknowledged that he believed subordinating Ergen's claims would allow Harbinger to retain equity in a post-bankruptcy LightSquared. Treating Ergen's $1.1 billion claim differently from other creditors' claims would decrease the amount of new equity LightSquared would need to raise to a fund a bankruptcy exit, preserving more for Harbinger, according to Falcone. The plan would retain a roughly 30 percent equity stake for Harbinger.

An investor has accused the hedge fund billionaire Philip A. Falcone of using his publicly listed company “to bail himself out” after a reaching an $18 million settlement with the Securities and Exchange Commission, the New York Times DealBook blog reported yesterday. In the weeks after the SEC settlement last August, Falcone’s hedge fund Harbinger Capital Partners was confronted with a flurry of requests from investors to return their money, according to a complaint filed by a Harbinger Group shareholder, Haverhill Retirement System. In a desperate attempt to find capital to replace the money flowing out, according to the lawsuit, Falcone sold some shares in Harbinger Group, where he is chief executive. He later sold additional shares and added two seats to the board of directors, eventually securing a $400 million investment by the Leucadia National Corporation, the suit contends.

The judge in LightSquared Inc.’s bankruptcy has been excluding some parties from closed-door conferences, possibly hindering a resolution of the case, two companies underwriting the wireless broadband provider’s reorganization said, Bloomberg News reported yesterday. The lenders, Melody Business Finance LLC and Centaurus Capital LP, wrote a letter to Bankruptcy Judge Shelley Chapman yesterday to address what they called their “exclusion” by the court from an off-the-record conference in her chambers yesterday. Philip Falcone’s LightSquared is seeking approval of a bankruptcy exit plan that would put Dish Network Corp. Chairman Charles Ergen at the back of the line to be repaid and close a two-year battle for control of the company’s airwaves. Hearings are under way to determine the status of Ergen’s $1 billion claim and get approval of the reorganization.

Broadband company LightSquared has urged a judge not to re-open a trial that ended last week over Dish Network Corp Chairman Charles Ergen's purchase of LightSquared debt, saying that it would delay resolution of LightSquared's bankruptcy proceedings, Reuters reported yesterday. In a court filing on Friday, lawyers for LightSquared said that the company should not have to bear the "tremendous cost" in money, time and distraction and have its efforts to emerge from bankruptcy imperiled. LightSquared, which filed for bankruptcy in 2012, presented closing arguments last week in a trial over whether Ergen improperly acquired $1 billion of the company's debt to take control of its wireless rights. Bankruptcy Judge Shelley Chapman has not yet issued a ruling in the trial, which ended yesterday.

Credit Suisse Securities LLC said in a letter on Friday that Philip Falcone’s LightSquared Inc. will probably be able to borrow $1 billion to finance its exit from bankruptcy as a standalone company, Bloomberg News reported on Saturday. The Credit Suisse Group AG unit said that it was confident it could arrange the proposed bankruptcy-exit loan as long as LightSquared, a wireless broadband provider, met conditions including obtaining the “cooperation of all parties-at-interest” in the reorganization and “all required regulatory approvals.” LightSquared, based in Reston, Va., sought bankruptcy protection in 2012 after the Federal Communications Commission blocked the company’s service, saying that it might interfere with civilian and military global-positioning-system navigation equipment. Since then, it’s been engaged in a struggle for control of its future with Dish Network Corp. Chairman Charles Ergen.

NEC Corp. of Japan said today that it had succeeded in a second attempt to acquire a unit of A123 Systems LLC, an American provider of green-energy technologies that was funded by the Obama administration before filing for bankruptcy protection in 2012, the Wall Street Journal reported today. NEC has agreed to buy a division of A123 that provides power storage systems to alternative energy plants. NEC said that it would pay about $100 million to acquire the business from Wanxiang Group Corp., a Chinese company that bought A123, including its automotive battery business, during the bankruptcy proceedings for $257 million.

A member of a committee helping to oversee LightSquared's restructuring said on Wednesday he believes the company's plan to subordinate the claims of its largest creditor, Dish Network Corp Chairman Charles Ergen, is fair, Reuters reported yesterday. Testifying in the U.S. Bankruptcy Court in New York, Christopher Rogers, a member of the independent special committee, said that the plan is not an attempt to punish Ergen for what LightSquared views as his surreptitious methods of acquiring debt. LightSquared filed for chapter 11 in 2012 after the Federal Communications Commission revoked its license to build a planned wireless network on concerns it could interfere with GPS systems. Ergen bought up about $1 billion worth of LightSquared's senior loan debt, despite an agreement between LightSquared and its lenders that barred competitors from acquiring the company's debt. Ergen said that he bought the debt in his personal capacity, not on behalf of Dish.