Looks like the long arm of the law finally caught up to the Redstones
, as Sumner and his daughter Shari have both been subpoenaed by the U.S. Bankruptcy Court, District of Massachusetts, regarding Sumner selling his stake in Midway to Mark Thomas
. Both of the Redstones must appear in a New York court later this month for deposition and will provide physical and electronically-stored documents pertaining to the sale of Midway
. For some odd reason, Mark Thomas hasn't been called. He bought Sumner's stake in the company for $100,000 and assumed $70 million in debt in doing so, which is something we would assume the court would want to hear about.
Speculation suggests that Mark took over the $70 million debt because $30 million of it was secured debt, meaning that it would be paid to Thomas before the bondholders, who are owed a total of $150 million by Midway. The subpoena document states: "The cash collateral order places a clear emphasis on insiders getting paid before and, potentially, at the expense of the estates and their creditors." If you want to read the document for yourself, click here
(warning: pdf link).