IN RE APPLIEDTHEORY CORP.

No. 05 Civ. 10183(DLC).

345 B.R. 56 (2006)

In re APPLIEDTHEORY CORPORATION, et al., Debtor. Official Committee of Unsecured Creditors of AppliedTheory Corporation, Appellant, v. Halifax Fund, L.P., Palladin Partners I, LP, Palladin Overseas Fund Ltd., Deam Convertible Arbitrage Fund, Ltd., Spectrum Investments Partners, LP, Elliot International, LP, and Elliott Associates, LP, Appellees.

United States District Court, S.D. New York.

June 22, 2006.


Attorney(s) appearing for the Case

Andrew Silfen, Schuyler Carroll, Leah Eisenberg, Heike Vogel, Arent Fox PLLC, New York, NY, for Appellants Official Committee of Unsecured Creditors of AppliedTheory Corporation.

Kirk Brett, Mary Miras, Duval & Stachenfeld LLP, David Parker, Kleinberg, Kaplan, Wolff & Cohen P.C., New York, NY, for Appellees Palladain Overseas Fund, Ltd., Halifax Fund, L.P., Palladin Partners I, L.P., Deam Convertible Arbitrage Fund, Ltd., Spectrum Investment Partners, LP, Elliott International, L.P. and Elliott Associates, L.P.


OPINION & ORDER

COTE, District Judge.

This bankruptcy appeal raises the question of whether a creditor's committee may bring an equitable subordination claim without first receiving court approval. It may not. The ruling of the Bankruptcy Court is affirmed.

Background

The debtors in this action are AppliedTheory Corporation and related entities ("Debtors"). On April 17, 2002, the Debtors filed a voluntary petition for...

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