Creative Loafing Inc. of Tampa retains control of its six papers, including the Reader, a bankruptcy judge ruled Tuesday in Tampa. Atalaya, a capital management firm owed about $32 million by Creative Loafing, had asked to be awarded the papers, arguing in court that Ben Eason, who is Creative Loafing's CEO, was running the company into the ground.
Here's a report from Creative Loafing Tampa blogger Wayne Garcia. He writes that Judge Caryl Delano explained from the bench she'd heard no evidence "that Creative Loafing’s woes are anything beyond those being experienced by all newspaper and news media companies in this recession." But as for Creative Loafing's counterargument that the company's value had doubled since it filed for bankruptcy last September, the judge said that "just defies belief.”
Delano said Creative Loafing has "an uphill battle" ahead of it, Garcia reports, because Atalaya can vote against any reorganization plan the company submits. "Delano suggested mediation for the two sides," writes Garcia, "but after a 30-minute recess in which the two sides' lawyers talked by telephone, the idea of having a mediator appointed was tabled . . . at least until April 20, when Creative Loafing reveals more details of its reorganization plan, including possible new investors."