Remember Phil Falcone? Hedge fund manager about yea high? Cuts his hair like he’s still playing professional hockey? Is betting the farm on a company called LightSquared that “seeks to create connectivity for all” but in doing so might “cost 794 lives in aviation accidents over 10 years with disruptions to satellite-aided navigation” and filed for Chapter 11 bankruptcy last May? Anyway, LightSquared’s creditors were in court today asking for the right to go after Big Phil/Harbinger, who they believe screwed them big time.
LightSquared’s lenders Wednesday pressed their case that they should be allowed to go after Phil Falcone and his Harbinger Capital Partners hedge fund firm for a July 2011 loan made to LightSquared, a transaction they say benefited Harbinger and could hurt other creditors. A lawyer for the lenders, owed more than $1.1 billion, said his group deserved the right to prosecute claims on behalf of LightSquared creditors, because the wireless satellite company is itself controlled by Harbinger and thus not in position to make the move.
According to Judge Shelly C. Chapman, it might be a while before she has an answer on account of there being “a lot of complicated issues” to sort through, while Richard Slack, a lawyer for Harbinger, argued that everyone should just calm down and give LightSquared some time because one day? It’s going to be worth mucho dinero.
Mr. Slack, the Harbinger lawyer, cited an estimate that the company could be worth as much as $12 billion. Mr. Kurtz, the lenders’ lawyer, called such a projection a “Hail Mary” estimate.