Oaktree Capital Management filed with the U.S. Bankruptcy Court a motion for an order directing Claire’s Stores to modify its marketing process.
The motion explains, “There are a myriad of reasons why the Debtors would have chosen not to seek this Court’s approval of any aspect of the RSA, the most notable of which are the troubling questions it would raise as to the impropriety of their corporate governance practices and their failure to properly exercise fiduciary duties. However, the Debtors’ tactical decision to hold the RSA outside this Court’s purview is not license to keep the Court in the dark on all issues related to their implementation of the RSA; issues that go to the core of the chapter 11 plan process. The need for transparency and judicial oversight is particularly acute with respect to the process by which the Debtors will seek bids to top the RSA Plan (which will likely require the investment of hundreds of millions of dollars of exit capital and the assumption of significant existing obligations) and to ensure that the Debtors are taking all appropriate actions to maximize value for all stakeholders.”
In addition, “To Oaktree’s bewilderment, the Debtors have simply ignored the required step of subjecting any aspect of the Marketing Process, which is clearly being driven by the RSA, to scrutiny by this Court….In order to bring much needed judicial oversight, transparency, and fairness to the Marketing Process, and to prevent further loss to the estate, Oaktree seeks entry of an order pursuant to sections 105, 363 and 1107 of the Bankruptcy Code directing the Debtors to make certain modifications to their Marketing Process.”
The Court scheduled a May 18, 2018 hearing on the motion.
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