April 8, 2010 / 3:29 PM / 9 years ago

Judge rules against big Chemtura bankruptcy claim

NEW YORK, April 8 (Reuters) - Bankrupt U.S. chemicals maker Chemtura Corp CEMJQ.PK and its creditors won out over a California interest group with a $9 billion claim, when a judge ruled against the claim on Wednesday, according to a company lawyer.

U.S. Bankruptcy Judge Robert Gerber said during a court hearing that the Council for Education and Research on Toxins (CERT) did not have the standing it needed in the Chemtura bankruptcy to make a claim, the lawyer said. Gerber also denied other modified versions of the claim.

Chemtura and the creditors had argued that because CERT was not a creditor, bankruptcy rules prevented it from pursuing the claim in court.

“We don’t believe that there would be any appropriate avenue for them to renew the claims,” attorney Natasha Labovitz of Kirkland & Ellis LLP told Reuters. Kirkland represents Chemtura.

The oral ruling is to be followed by a written order, she said.

Chemtura, which filed for bankruptcy last year, was not immediately available for comment. The company was created in 2005 in the merger of Crompton Corp and Great Lakes Chemical Corp. It makes plastic additives such as flame retardants among other chemical products.

CERT filed the claim in October of 2009, saying the $9 billion was for the “public interest” due to injuries allegedly caused by chemicals.

The case is in re: Chemtura Corp, U.S. Bankruptcy Court, Southern District of New York, No. 09-11233. (Reporting by Caroline Humer, editing by Gerald E. McCormick)

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