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A judge has “strongly” advised Eddie Lampert’s hedge fund, which bought Sears out of bankruptcy last month, to hand over millions of dollars to the old Sears.
At a Thursday hearing, US Bankruptcy Judge Robert Drain weighed in on the contentious financial dispute between Sears and Transform Holdco, the firm owned by billionaire investor Eddie Lampert’s hedge fund ESL Investments, which bought most of Sears’ assets out of bankruptcy last month.
Drain seemed to side with Sears, which says Lampert’s ESL swiped tens of millions from its coffers in the days before it closed on a $5.2 billion deal to create a new, smaller Sears chain with 425 stores.
The judge warned that if ESL does not return the funds — about $14.6 million in credit card receivables and $18.5 million in cash — that it could be in violation of an automatic stay and liable for damages.
“He told both sides: ‘You have a contract; live up to it,’” according to David H. Wander, a partner of Davidoff Hutcher & Citron.
Drain indicated that he’d settle the matter at a hearing on April 18.
