The end of Trib's bankruptcy means new legal pain for shareholders

Tribune Company will exit the mire of its four-year bankruptcy within weeks, but thousands of former employees and shareholders likely will remain stuck in litigation with the company's creditors for years. The Chicago-based media conglomerate will implement a bankruptcy reorganization plan that partially pays off creditors but also lets some of those IOU-holders revive litigation to squeeze the employees and shareholders for additional repayment. About 50 cases filed in state and federal courts nationwide have been consolidated in New York but were on hold during the past two years, pending Tribune's emergence. Chief among the creditors' targets are former Tribune executives, directors and advisers, including current Tribune Chairman Sam Zell and former CEO Dennis FitzSimons, who led Tribune through a 2007 leveraged buyout that saddled the company with $13 billion in debt. But also caught in the dragnet are rank-and-file employees who sold stock or collected deferred compensation in the LBO and even elderly investors who long ago bought Tribune stock. “It's screwy,” says Gloria Trudman, a 78-year-old Northbrook woman and former Tribune shareholder who wrote to the federal judge in New York handling the consolidated cases after receiving what she called a “book” explaining the lawsuit against her.