Creditors seek examiner in FairPoint bankruptcy

The Associated Press
Posted Nov. 08, 2009, at 12:52 p.m.

PORTLAND, Maine — A U.S. Bankruptcy Court judge has scheduled a Nov. 18 hearing on a motion to appoint an examiner to investigate factors leading to FairPoint Communications Inc.’s Chapter 11 bankruptcy last month.

A group of creditors who are owed more than $550 million wants to know if FairPoint’s top managers misrepresented the company’s prospects for recovery and are trying to profit from the reorganization. The creditors are also asking why the company paid a $23 million dividend just as the financial problems were mounting.

FairPoint, based in Charlotte, N.C., operates phone companies in 18 states. Its largest holdings are in Maine, New Hampshire and Vermont, where it bought Verizon Communications’ landline and Internet assets last year.

FairPoint denied the allegations in a statement to the Portland Press Herald.

http://bangordailynews.com/2009/11/08/business/creditors-seek-examiner-in-fairpoint-bankruptcy/ printed on December 19, 2014