Linn Energy Bankruptcy
Oil and gas producer Linn Energy LLC filed for chapter 11 bankruptcy May 11th after reaching a deal with lenders to restructure its $8.3 billion debt load and obtain $2.2 billion in fresh financing.
As we have discussed in previous posts, dipping oil and gas prices have forced many energy companies to look for ways to restructure their debt. Investors in these partnerships could be facing a hefty tax bill as they are hit with taxes on debt that the partnership eliminates.
In an effort to ease the pain to investors, Linn Energy made two exchange offers in which holders of Linn Energy units were given the chance to swap them for stock in LinnCo. Shares in both companies are likely to be wiped out now that they are in bankruptcy, but the swap but may help the tax issue for investors.
Linn focuses its exploration and production efforts in the Colorado Rockies, California, Hugoton Basin, Mid-Continent, Permian Basin, east Texas and north Louisiana, Michigan, Illinois and South Texas, stating its assets are worth $11.6 billion.
The White Law Group is investigating the liability that brokerage firms and financial advisors may have for recommending high risk MLPs, like LINN Energy, to their clients. Brokerage firms that recommend energy investments are required to perform adequate due diligence on the investments to ensure a reasonable likelihood of success, and to evaluate whether the investments are suitable in light of their client’s age, net worth, investment experience, risk tolerance, and investment objectives. Firms that fail to perform adequate due diligence, or that make unsuitable recommendations, can be held responsible for losses in a FINRA arbitration claim.
Recovery of Investment Losses
If you suffered losses investing in LINN Energy and would like to discuss your litigation options, please call The White Law Group at (888) 637-5510 for a free consultation.
The White Law Group is a national securities arbitration, securities fraud, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida. The firm represents investors throughout the country in FINRA arbitration claims against their brokerage firm.
For more information on The White Law Group, visit www.whitesecuritieslaw.com.