Indianapolis Downs plan draws objections from U.S. Trustee, creditors

By Caroline Salls

Pittsburgh, July 31 - Indianapolis Downs, LLC's second amended joint plan of reorganization drew objections from U.S. trustee Roberta A. DeAngelis and unsecured creditors calling themselves the Oliver parties, according to Tuesday filings with the U.S. Bankruptcy Court for the District of Delaware.

In her objection, DeAngelis said "the release and exculpation provisions of the plan are too broad in scope and include non-debtor third parties that are otherwise not entitled to such relief."

In addition, the U.S. Trustee said other classes of creditors who are entitled to vote on the plan but fail to mark or return their ballots are forced to grant involuntary releases.

Meanwhile, the Oliver parties said the proposed plan is the product of negotiations between the Indianapolis Downs debtors and the restructuring support parties, and neither the Oliver parties nor any other unsecured creditors participated in the negotiations "in any meaningful way."

"As can be expected from negotiations that include no unsecured creditors, the plan provides for no distribution whatsoever on account of class 5 general unsecured claims," the Oliver parties said in their objection.

The Oliver parties said the plan was not negotiated in good faith and by legal means and includes preferential treatment for Fortress "that translates into disparate treatment among creditors of the same class."

The Oliver parties include Ross J. Mangano, both individually and as the trustee of the Jane C. Warriner Trust, the J. Oliver Cunningham Trust and the Anne C. McClure Trust, as well as Troon & Co., John C. Warriner, Oliver Estate, Inc. and Oliver Racing, LLC.

Indianapolis Downs, a Shelbyville, Ind., racetrack, off-track betting and gaming company, filed for bankruptcy on April 7, 2011. Its Chapter 11 case number is 11-11046.

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