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DELAWARE COURT RULING AWARDING CONTINUED CLBN CONTROL OF MGM-PATHE ALLOWS STUDIO TO CONTINUE WITH STATUS QUO

 DELAWARE COURT RULING AWARDING CONTINUED CLBN CONTROL
 OF MGM-PATHE ALLOWS STUDIO TO CONTINUE WITH STATUS QUO
 Pathe Looking Toward Vigorous Lender Liability Fight
 WILMINGTON, Del., Dec. 30 /PRNewswire/ -- The Delaware Chancery


Court ruling today awarding continuing control of MGM-Pathe Communications to Credit Lyonnais Bank Nederland (CLBN), which seized control of the company June 16, is unfortunate, yet changes little in the current Pathe Communications Corp. (NYSE: PCC) operations, according to Liliana Avincola, Pathe president.
 The ruling excluding Giancarlo Parretti and Maria Cecconi, vice chairman and corporate secretary of Pathe Communications Corp., respectively, from management control of MGM-Pathe does not affect Pathe's continued ownership of 98.5 percent of the stock of MGM-Pathe, nor the holding company's business interests.
 "We are still reviewing the Chancellor's 89 page opinion resulting from the six-week trial and haven't yet assessed its full affect on the company," Avincola said.
 Pathe said it will now focus on pursuing its billion-dollar lender liability action against CLBN in Los Angeles Superior Court. Additionally, the company will review the chancellor's ruling to see what other action it may pursue.
 "We are extremely disappointed with the ruling in this unfortunate action," said Avincola. "Nevertheless, Pathe remains the principal shareholder of MGM-Pathe and will exercise the remaining rights afforded to it as shareholders. There will be little change in Pathe's operations as maintained over the last six months since this lamentable course of action began.
 "We plan to move forward vigorously with our lender liability action in Los Angeles Superior Court against Credit Lyonnais Bank Nederland, in which we have charged it with bad faith, unlawful actions, misrepresentation and misapplication of funds." In that suit, Pathe is seeking more than $1 billion in damages, which, if granted, would be the largest lender liability judgment in history
 Attorneys for Pathe are expected to call a number of witnesses in the lender liability action that were not called in the Delaware case, Avincola said. Such witnesses will add tremendous insight to the internal dealings of the bank and give added strength to Pathe's position. "We expect the result of the lender liability case to be significantly different from that issued today," she said.
 The suit, filed in Los Angeles Superior Court July 10, details a consistent pattern of bad faith in Credit Lyonnais dealings with Pathe and Parretti, as well as classic lender abuses including the bank's violation of its own rules, misapplication of funds, coercion in the execution of documents and failure to fund loans as promised. It also reveals that Credit Lyonnais mandated that Pathe pursue a course of conduct that would have allowed the institution to recover its loans more quickly than it had previously agreed to.
 Pathe Communications Corp.'s common stock is listed on the New York Stock Exchange. Pathe is a holding company whose chief asset is 98.5 percent of the stock of MGM-Pathe Communications Co.
 -0- 12/30/91
 /CONTACT: Richard S. Kline or Gregory F. Romano of Berkhemer Kline Golin/Harris, 213-623-4200, for Pathe/
 (PCC) CO: Pathe Communications Corp. ST: Delaware IN: ENT SU:


DM -- LA016 -- 5791 12/30/91 20:04 EST
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Publication:PR Newswire
Date:Dec 30, 1991
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