Dura bondholder states case against alleged plan creditor discrimination

By Caroline Salls

Pittsburgh, May 9 - Dura Automotive Systems, Inc. bondholder James W. Korth continued his fight against confirmation of the company's plan of reorganization Friday by asking the U.S. Bankruptcy Court for the District of Delaware to deny confirmation based on alleged creditor treatment discrimination.

Specifically, Korth said the plan unfairly discriminates against 9% noteholders because it awards a distribution to unsecured creditors, while the bondholders are slated to receive nothing.

Korth said the noteholders should receive the same distribution as the unsecured creditors.

As previously reported, Korth's previous motion for adjournment of the plan confirmation hearing was denied by the court last month.

Korth claimed he needed more time to gather and analyze information related to the plan. Additionally, he said Dura had not provided all of the information he requested.

Korth also sought court approval in March to examine company records in connection with his plans to conduct an independent value assessment.

Dura objected to Korth's motion to postpone the confirmation hearing on the grounds that it had provided, or would provide by April 23, all of the information Korth requested.

The plan confirmation hearing is scheduled for May 13.

Dura, a Rochester Hills, Mich.-based automotive parts maker, filed for bankruptcy on Oct. 30, 2006. Its Chapter 11 case number is 06-11202.

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