Charlie Ergen and Phil Falcone are like Joan Collins, Susan Lucci and their respective enemies. These soap opera stars who ruled both prime time and daytime television brought the drama like these two men when they talk about each other. It’s just a matter of what time a day they make their comments. Perhaps, House of Cards’ actors would have been more appropriate now that Falcone has brought politics into the equation.
Phil Falcone: Nixon comparison
According to papers filed in Manhattan bankruptcy court, Falcone, the hedge fund billionaire, wrote that Ergen’s suggestions that he was investing in LightSquared debt for “personal reasons” and not for DISH Network Corp (NASDAQ:DISH) reek of “the type of ‘non-denial denials’ the Nixon White House offered when confronted by the Watergate break-in.”
“Ergen’s plan all along … was to sow confusion and have the bankruptcy process collapse, so that he could swoop in and pick up the pieces” for DISH Network Corp (NASDAQ:DISH), Falcone’s lawyers argued.
These little treats came on the heels of LightSquared and Harbinger Capital’s (Falcone’s) last chance to convince Bankruptcy Judge Shelley Chapman that not only were Ergen’s purchases of LightSquared debt (through Stephen Ketchum) not for “personal reasons” but improper if not illegal.
Falcone, in the joint filing maintains that the only reason Ergen used his own money to buy a controlling debt position in LightSquared was the simple fact that DISH Network Corp (NASDAQ:DISH) was legally barred from buying it itself. This paved the way for Falcone’s Harbinger Capital to buy up the equity position.
Let’s go back a bit: LightSquared was forced into Chapter 11 after regulators failed to agree to the company’s plan to build its network on undeveloped wireless bandwidth. Bandwidth that will be worth billions once regulators agree to its use forced by a foreseen spectrum shortage.
Can’t we all just get along?
Falcone alleges that once DISH Network Corp (NASDAQ:DISH) was barred from purchasing LightSquared debt having been deemed a rival by regulators, Stephen Ketchum came in at the behest of Ergen and purchased $247 million of debt held by Carl Icahn. He also believes that Ergen, through Ketchum, to vote against a plan that would have saved LightSquared from bankruptcy.
The latest filing comes ahead of a confirmation hearing on the $2.65 billion restructuring plan that is slated for March 17. If Falcone wins he’s looking to severely slow or even void the payments to Ergen.
If it sounds like a billionaires game of “he said, she said” or “I’m taking my ball and going home,” well, it is.