Burkle’s Yucaipa Sued for Draining Funds as Legal Battles Raged

Ron Burkle’s Yucaipa Cos. is being sued by the bankrupt shell of a failed car hauler that argues the private equity firm knowingly drove some funds to insolvency, and paid out millions to insiders and its investors as its legal woes mounted.

A lawyer in charge of pursuing legal claims for Allied Systems Holdings creditors alleges Yucaipa wrongly moved almost $400 million out of certain funds that were on the hook for legal liabilities tied to the private equity firm’s investments in Allied. The transfers were so intense that the relevant funds are now insolvent and can’t pay a ...