RadioShack's junior creditors are suing hedge fund Standard General LP, the company's largest prebankruptcy shareholder and current owner, in a last-ditch effort to get repaid.

The lawsuit, filed Monday in U.S. District Court in Fort Worth, Texas, by the committee representing RadioShack's unsecured creditors, also names Wells Fargo & Co. and former Chief Executive Officer Joseph Magnacca, alleging they helped Standard General take over the company at creditors' expense.

The suit comes as the electronics retailer moves forward with a number of settlements aimed at speeding its exit from chapter 11 protection. The bankruptcy sale of RadioShack's assets earlier this year raised only enough to cover the company's top-ranking loans, leaving litigation against RadioShack's owner and lender as the unsecured creditors' best hope of seeing a recovery.

Standard General and Wells Fargo couldn't immediately be reached for comment.

Write to Matt Wirz at matthieu.wirz@wsj.com

 

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

(END) Dow Jones Newswires

August 31, 2015 16:25 ET (20:25 GMT)

Copyright (c) 2015 Dow Jones & Company, Inc.
Wells Fargo (NYSE:WFC)
Historical Stock Chart
From Feb 2024 to Mar 2024 Click Here for more Wells Fargo Charts.
Wells Fargo (NYSE:WFC)
Historical Stock Chart
From Mar 2023 to Mar 2024 Click Here for more Wells Fargo Charts.