Judge: iHM vs. Bondholders Case To Remain In Texas

A Bexar County Texas district court judge has denied a motion to change the jurisdiction of San Antonio-based iHeartMedia Inc.’s lawsuit against some of its bondholders.

The ruling, which came late Friday from District Judge Kathleen Stryker, means that the case will remain in Bexar, according to the Express-News.

The jurisdiction had been challenged in a March motion by more than 15 bondholders, mainly hedge funds located outside of Texas, but a hearing on the jurisdiction question had been delayed until Wednesday last week to give iHeartMedia lawyers time to take depositions on the question.

Lawyers for the bondholders argued at the Wednesday hearing that the lawsuit centered on a transfer of assets within iHeartMedia subsidiaries, placing the assets outside the reach of some noteholders, who live outside of Texas.

iHeartMedia lawyers told Stryker that the lawsuit should remain in Bexar County because it involves a breach of contract when the bondholders in January and February threatened debt default notices and in March issued default notices, causing harm to the San Antonio-based radio and billboard company. The default notices were rescinded March 9 by a temporary restraining order.

The lawsuit had two days of hearings on April 4-5 and was suspended until May 16.