UPDATE 1: Paragon Equityholders Seek Emergency Stay of Confirmation Order at District Court

UPDATE 1: 10:21 p.m. EDT 7/5/2017: After Judge Christopher Sontchi denied the Paragon Offshore equityholder appellants' attempt to stay the Paragon confirmation order this afternoon, the Paragon Offshore equityholders filed this evening an emergency motion seeking the same relief from the district court. The motion argues that the shareholders were "effectively sidelined" in the chapter 11 cases, particularly after the appointment of an official equity committee was denied, and have not yet had their day in court. The equityholders further reiterate that they have retained counsel in the U.K. relating to the debtors' U.K. restructuring to review "significant issues relating to whether the Debtors had the appropriate corporate authority to take the actions that they did in the United States and whether the rights of the shareholders under United Kingdom law have been violated." A stay will provide the shareholders with a meaningful ability to pursue the "significant issues" in the U.K. and potentially prevent the "manifest injustice that would occur if Debtors were able to use U.S. bankruptcy procedure to circumvent UK shareholder protections," asserts the filing. The equityholders urge the district court to grant a stay of the confirmation order pending appeal, arguing that if the debtors' plan becomes effective this Friday, July 7, the shareholders "will be deprived of the chance to vindicate their interests, and likely prevented from any recovery, despite their meritorious claims."

The equityholders seek an expedited hearing on the motion for July 7 or as soon thereafter as possible.