MOTION OF ELLIOTT MANAGEMENT CORP. FOR THE ENTRY OF AN
ORDER APPROVING SPECIFIED INFORMATION BLOCKING
PROCEDURES AND PERMITTING TRADING OF CLAIMS AGAINST THE
DEBTORS UPON ESTABLISHMENT OF A SCREENING WALL
Looks like Elliot wants to get a little more active...read the last paragraph about "Covered Claims".
RELIEF REQUESTED
5. Elliott requests the entry of an order indicating that Elliott, which is
engaged in the trading of securities and/or claims for others or for its own account as a
regular part of its business, will not violate its fiduciary duties as a member of the
Committee by trading in the Covered Claims during the pendency of the Debtors’
Chapter 11 cases, provided that Elliott establishes, effectively implements, and adheres to
the information blocking policies and procedures (collectively, the “Screening Wall”)
that are approved by the Office of the United States Trustee herein or that are otherwise
consistent with those described in the Screening Wall Declarations (as defined below),
annexed hereto as Exhibit “A”.
6. The term “Screening Wall” refers to a procedure established by an
institution to isolate its trading activities from its activities as a member of an official
committee of unsecured creditors in a chapter 11 case. A Screening Wall includes,
among other things, such features as the employment of different personnel to perform
certain functions, physical separation of the office and file space, procedures for locking
committee related files, separate telephone and facsimile lines for certain functions, and
special procedures for the delivery and posting of telephones messages. Such procedures
will prevent Elliott’s trading personnel from use or misuse of non-public information
obtained by Elliott’s personnel engaged in Committee related activities (“Committee
Personnel”) and also will preclude Committee Personnel from receiving inappropriate
information regarding Elliott’s trading in the Covered Claims in advance of such trades.
7. Although members of the Committee owe fiduciary duties to the creditors
of these estates, Elliott also has fiduciary duties to maximize returns to its clients through
trading securities. Thus, if Elliott is barred from trading the Covered Claims during the
pendency of these bankruptcy cases because of its duties to other creditors, it may risk the
loss of a beneficial investment opportunity for itself and/or its clients and, moreover, may
breach its fiduciary duty to its clients. Alternatively, if Elliott is compelled to resign from
the Committee because of its inability to trade for the benefit of itself and its clients, its
interests may be compromised by virtue of taking a less active role in the reorganization
process. Elliott should not be forced to choose between serving on the Committee and
risking the loss of beneficial investment opportunities or foregoing service on the
Committee and possibly compromising its responsibilities by taking a less active role in
the reorganization process, particularly because its service as a Committee member
benefits all unsecured creditors.
8. As evidence of its implementation of the procedures detailed herein, filed
herewith are declarations (the “Screening Wall Declarations”) by Elliott’s Committee
Personnel, which state that such individuals shall comply with the terms and procedures
consistent with those set forth in this Motion or otherwise approved by the United States
Trustee.
1 “Covered Claims” is used in this Motion to mean any claims against the Debtors, including (i)
“Securities” as defined in Section 2(a)(1) of the Securities Act of 1993 (including the following: stocks,
notes, bonds, debentures, participation in, or derivatives based upon or relating to, any of the Debtors’ debt
obligations or equity interests) and (ii) bank debt.
Coach T
