Justices Asked to Pause Order Allowing CEO Bankruptcy Suit (1)

Highland Capital Management LP asked the US Supreme Court to immediately pause an appeals court decision allowing the investment firm’s former CEO to pursue bankruptcy-related litigation against it.

Halting the US Court of Appeals for the Fifth Circuit’s mandate will allow the firm to challenge a decision over a bankruptcy court’s authority to act as a gatekeeper by screening out certain lawsuits, according to Highland’s emergency application filed Wednesday with the high court. The appeals court mandate is due to take effect on May 30.

The company for years has been litigating with its former chief executive, James Dondero, over ...