2015
09/30

Category:
Filing Bankruptcy

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RadioShack Creditors Sue Hedge Fund Over Chain’s Collapse

The lawsuit targets Standard General, its principal investment officer, company lender Wells Fargo Bank and RadioShack’s former top managers, including Joseph Magnacca, the former chief executive.

Reduced Price

Creditors accuse Magnacca of helping Standard General take over RadioShack at a reduced price in return for getting a position on the board of directors for another troubled retailer controlled by the hedge fund, T-shirt maker American Apparel, according to the complaint.

After filing bankruptcy, the company closed about half its 4,000 stores and in March sold about 1,700 of the remainder to Standard General, which had been the company’s biggest shareholder, for about $145.5 million.

Richard Hahn, a bankruptcy lawyer for Standard General, didn’t immediately reply to an e-mail requesting comment on the lawsuit. Alfred Perez, a lawyer for Magnacca, and Cory Falgowski, an attorney for Wells Fargo, didn’t immediately return phone calls seeking comment.

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