Bankruptcy Law News

Chesapeake Energy Slams ‘Divorced From Reality’ Creditor Claims

Dec. 2, 2020, 10:35 PM

Allegations that Chesapeake Energy Corp. built its existing capital structure on a fraudulent scheme to favor certain lenders are “divorced from reality” and shouldn’t be allowed in the oil driller’s bankruptcy case, the company said.

Chesapeake’s chances of reorganizing as a going concern will be at risk if a committee of unsecured creditors can sue Deutsche Bank, Franklin Resources Inc., and other lenders to challenge billions of dollars of debt claims, the company said in a filing Tuesday.

The committee alleges that, prior to filing for bankruptcy in June, Chesapeake engaged in a “liability management” scheme through two refinancing deals—together...

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