Don't let Rigases sell, Adelphia tells court

Copyright 2002 P.G. Publishing Co.
Pittsburgh Post-Gazette...08/28/2002
From LexisNexis

Bill Bergstrom, The Associated Press
From The August 28, 2002 Edition Of CED Broadband Direct

Adelphia Communications Corp. has asked a federal bankruptcy court to stop its founder from selling property that the cable television systems owner said is at least partly owned by the company.

Adelphia said John J. Rigas and family members had a "pattern of using Adelphia's funds to purchase and maintain their real estate assets," and it was likely the company owned an interest in "any parcel of real property in which the Rigases claim an interest and seek to liquidate."

"Adelphia has reason to believe that members of the Rigas family are endeavoring to sell or transfer various real property assets which, although ostensibly titled in the name of Rigas family members, may constitute property in which Adelphia has a legal or beneficial interest," George F. Carpinello, an attorney for Adelphia, said in documents filed late Monday in U.S. Bankruptcy Court in New York.

At least one property is under contract for sale, according to the company filing. "It is possible that any transaction allowed to proceed to closing could not be voided," company attorneys wrote.

Attorneys for the Rigases didn't return calls yesterday seeking comment.

The Coudersport, Potter County-based cable giant had filed a civil complaint July 24 accusing Rigas and family members of conspiring to use company funds for their own benefit and filing false financial statements that didn't reveal those transactions.

John Rigas, the 77-year-old founder and former chief executive of Adelphia, along with sons Timothy, 46, and Michael 48, were arrested July 24 on charges of stealing hundreds of millions of dollars from the nation's sixth-largest cable company.

Adelphia filed for Chapter 11 bankruptcy protection June 25.

An Adelphia employee said in a declaration accompanying Monday's motion that he had been informed that John Rigas had contracted to sell one property, on Hilton Head Island, S.C., for $560,000, and was making preparations to sell other properties in Roslyn, N.Y.

The company asked the court to bar any property sales by the Rigases under automatic stay provisions of the Bankruptcy Code, designed to halt sales of a company's assets during reorganization efforts.

If that was not done, Adelphia requested a temporary restraining order or preliminary injunction to prevent sales of properties until it is determined if the company has an interest in them.