Tribune Company bankruptcy deadlocked, judge says

After two weeks of confirmation hearings marked by hours of complex trial testimony, the Tribune Company bankruptcy case is right where it started: deadlocked.

"The parties are stuck," said US Bankruptcy Judge Kevin Carey shortly before court adjourned March 18. "We're in the middle of a multiconstituent … melee." Tribune Co. and its rival groups of creditors have been slogging through confirmation hearings aimed at resolving the 27-month-old case since March 7, when armies of lawyers descended on Wilmington (Delaware) to argue the merits of two competing plans for restructuring the company. But after 10 days of testimony, Judge Carey said he sees strengths and weaknesses in both plans and warned that it is possible he will confirm neither. In that case, he said, he likely would hold a hearing to appoint a Chapter 11 trustee to resolve the case, which would cause months of delays as the trustee got up to speed. With that in mind, Judge Carey implored the warring factions to try to carve out a new settlement.