NEW YORK (Reuters) - A trial over whether Cerberus Capital Management CBS.UL and Chatham Lodging Trust (CLDT.N) were justified in backing out of a deal to buy bankrupt Innkeepers USA Trust INKPQ.PK has been delayed.
The trial now is set for 10 a.m. Wednesday in U.S. Bankruptcy Court in Manhattan, according to a court filing. Attorneys for Innkeepers and Cerberus confirmed the delay.
Innkeepers sued Cerberus and Chatham after they walked away from a $1.12 billion deal to buy the bankrupt hotel operator. The buyers cited a clause that allowed them to back out if an event occurred that could harm Innkeepers’ business.
The trial, first scheduled for Monday, has been postponed three times as the sides work toward a settlement that would avoid litigation.
The case is Innkeepers USA Trust et al v. Cerberus Series Four Holdings LLC et al, U.S. Bankruptcy Court, Southern District of New York, No. 11-2557.
The Innkeepers bankruptcy is In re Innkeepers USA Trust, in the same court, No. 10-13800.
Reporting by Nick Brown in New York. Editing by Matthew Lewis and Robert MacMillan