On February 3, 2010, Judge Stephen Raslavich of the U.S. Bankruptcy Court for the Eastern District of Pennsylvania denied a motion by Chapter 11 debtors Philadelphia Newspapers LLC, et al., seeking to compel the company’s largest creditors, who had formed a Steering Group, to disclose the value and amount of the debt each owns pursuant to Federal Rule of Bankruptcy Procedure 2019.  Its decision that Rule 2019 does not apply to ad hoc committees deepens the case law split on that issue.  At present, a battle exists between Chapter 11 debtors and the hedge fund industry over the scope and application of Rule 2019.  Debtors advocate applying the rule to ad hoc committees to promote transparency in the reorganization process.  Hedge funds, guarded from disclosing their trading secrets in reorganizations, argue that compelling disclosure will adversely affect their business, and may deter non-traditional lender participation in reorganization cases.  Yet, recently, the debtors in many cases appear to be filing the motions to compel as litigation tactics to intimidate and divide their hedge fund creditors, and to gain leverage in disputes among different classes of creditors or between debtors and certain of its creditors.  For instance, in this action, the Steering Group maintained that the debtors did not file their motion until right before the U.S. Court of Appeals for the Third Circuit appeared ready to decide an important issue in this case having to do with the right of these lenders to “credit bid” at a forthcoming auction of the debtors’ assets.