On January 12, 2015, Appaloosa Investment LP and funds affiliated with Oaktree Capital and Tennenbaum Capital filed an involuntary bankruptcy petition against Caesars Entertainment Operating Company, Inc. ("Caesars") with the United States Bankruptcy Court for the District of Delaware. The petitioning creditors are junior noteholders of the debtor.
According to the Statement of Petitioning Creditors in Support of Involuntary Chapter 11 Petition Against Caesars Entertainment Operating Company, Inc., petitioning creditors asked the Court to appoint an examiner to investigate claims that Caesars' insiders plundered the company, paying themselves hundreds of millions of dollars while moving assets out of the reach of second-lien holders.
Meanwhile, three days later, Caesars filed for bankruptcy in the Northern District of Illinois, case no. 15-01145 (ABG) (Bankr. N.D. Ill.) (“Illinois Bankruptcy”). The petitioning creditors filed a motion with the Delaware Bankruptcy Court seeking a stay of the Illinois Bankruptcy and finding that venue is proper in Delaware. On January 15th, the Delaware Bankruptcy Court issued an Order staying the Illinois bankruptcy filing by Caesars while the Delaware Bankruptcy Court determines the proper venue in which the Caesars action shall proceed.
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