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"FairPoint trust suit blames Verizon for bankruptcy
By Clarke Canfield, The Associated Press, The Associated Press
Posted Nov. 01, 2011, at 3:41 p.m.
Last modified Nov. 01, 2011, at 7 p.m."
PORTLAND, Maine — A litigation trust created for FairPoint Communications Inc. creditors is blaming Verizon Communications for FairPoint’s bankruptcy.
In a $2 billion fraudulent transfer lawsuit filed in North Carolina last week, the FairPoint litigation trust claims FairPoint went bankrupt because of its “disastrous” $2.3 billion purchase of Verizon’s land line and Internet operations in Maine, New Hampshire and Vermont in 2008. FairPoint filed for bankruptcy 18 months after the acquisition.
The complaint alleges that Verizon lured FairPoint into the deal and dealt it a bad hand, resulting in FairPoint buying “inferior assets that had no future.” FairPoint exhibited a blend of naivete and optimism on its part, but FairPoint executives felt trapped by the time they saw the writing on the wall, the suit alleges.
“The company had no chance given the hand it was dealt by Verizon,” the complaint reads.
