Former Saks Global CEO challenges bankruptcy plan

Former Saks Global chief executive Richard Baker has objected to the retailer’s proposed Chapter 11 reorganisation plan, potentially prompting what could result in a lengthy legal battle as the company moves towards emerging from bankruptcy, according to WWD.

The media outlet said that Baker, who oversaw Saks Global during its 2.7 billion dollar acquisition of Neiman Marcus before departing as the company filed for bankruptcy in January, argued the retailer is attempting to remove legal protections preserved in his separation agreement.

The dispute is specifically regarding indemnification rights granted to Baker when he left the business. In a filing with the US Bankruptcy Court in Houston, Baker claimed the proposed reorganisation plan would remove those protections despite previous commitments.

Baker's challenge comes amid the continued scrutiny of the circumstances surrounding Saks Global’s collapse, with unsecured creditors, including fashion brands and suppliers owed significant sums, now expected to recover little directly through the bankruptcy process.

In May, Saks received approval from the Texas bankruptcy court for its reorganisation plan, opening it up to voting with the continued goal of emerging from bankruptcy in the summer.

A creditor committee has further pushed for the creation of a 20 million dollar litigation trust to investigate potential claims linked to the retailer, including decision-making surrounding the Neiman Marcus acquisition, executive transactions and other historical business dealings.