Tribune bankruptcy confirmation hearing begins

The warring creditors in Tribune Co.'s bankruptcy case fired their opening shots in a court hearing aimed at resolving a case that one lawyer said had come to resemble "water torture."

Lawyers for the two principal groups of combatants presented US Bankruptcy Judge Kevin Carey with a stark choice: He can confirm a restructuring plan favored by senior creditors, the company and many unsecured creditors based on a decidedly imperfect settlement of the legal claims surrounding the company's ill-fated 2007 leveraged buyout. Or he can bless a competing plan offered by junior bondholders that would open the case up to massive litigation in which each creditor would have a chance to seek its own recovery in the courts. Judge Carey himself offered a possible third outcome at the end of opening statements from each side. Lawyers may convince him that both plans are confirmable, he said, in which case he would have to choose between them. But he also hinted that that they might convince him that neither plan is confirmable.