Zohar Approved to Seek $2.6 Million From Other Tilton Entities

Zohar III Corp., a bankrupt group of funds once controlled by distressed investor Lynn Tilton, can pursue other Tilton entities to recover about $2.6 million in tax distributions, a Delaware judge ruled.

Zohar III can use a “contested matter” proceeding—via a motion and not a complaint—in seeking to recover the money, Judge Karen B. Owens of the U.S. Bankruptcy Court for the District of Delaware ruled Wednesday at a remote hearing.

Zohar’s motion doesn’t need to be part of a separate adversary proceeding that’s pending in bankruptcy court, the judge said.

The money that Zohar’s trying to recover relates to ...