• Bloomberg, Wednesday, August 11, 2010 11:30 PM

Tribune Chairman Sam Zell can't be made to pay for Tribune Co. retirement fund losses, a judge ruled, rebuffing workers who claim the billionaire caused the company's employee stock ownership plan to lose value. The workers sued Zell and his closely held company, EGI-TRB LLC, in 2008 after he took the Chicago-based newspaper publisher private in an $8.3 billion transaction. They alleged Zell used their plan to buy back shares, burdening it with unsustainable debt.

While the workers seek disgorgement of payments made to Zell and EGI-TRB by Tribune in the acquisition, U.S. District Judge Rebecca Pallmeyer in Chicago ruled yesterday they can't because Tribune isn't directly involved in the lawsuit. The publisher filed for bankruptcy court protection in Wilmington, Delaware, less than one year after going private. Some creditors have alleged the buyout was a fraudulent transfer: It added more than $8 billion in debt to the company while benefiting only Zell and his investors.

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