Elliott Greenleaf Continues to Successfully Represent Teamsters Union Local in Boston Herald Bankruptcy

Delaware Bankruptcy Judge Laurie Selber Silverstein delayed a Chapter 11 plan confirmation decision for a second time in the Boston Herald bankruptcy cases over proposed nonconsensual third party releases shielding former reporters and other content creators from defamation claims.

Rafael X. Zahralddin and Eric M. Sutty of Elliott Greenleaf PC are counsel to International Brotherhood of Teamsters Local No. 25 in the cases.

This was the second delay in the confirmation hearing after a court direction earlier this month directed the Debtors to explore defamation insurance options for those former employees who might face damage suits for past Herald work. The search for insurance alternatives turned up only limited coverage provisions, at cost-prohibitive rates.

Eric M. Sutty said the Teamsters oppose the added insurance expense and has the potential to block plan confirmation. “We’re going to be forced to bear the burden of this imperfect solution,” Sutty said, adding that allowing the case to convert to a Chapter 7 liquidation might provide a faster route to distribution of sale proceeds than “waiting for the insurance to run out.

Judge Silverstein said there should be ways to solve the problem. Judge Silverstein noted that she wanted to consider the issue for a few days. Publication of the Herald, under various names, dates back to 1846. The paper commenced the bankruptcy cases to liquidate its assets and agreed to sell its business for $11.98 million in February to hedge fund-controlled MediaNews Group.