Media moguls Bruce Gordon and Lachlan Murdoch are reportedly continuing their legal battle against the CBS takeover of the Ten Network after losing a Supreme Court challenge on Monday.
As creditors of the embattled Ten Network prepare to meet in Sydney on Tuesday for a possible vote on the broadcaster's future, local suitors Mr Murdoch and Mr Gordon are reportedly readying an appeal against the Supreme Court ruling.
The Supreme Court dismissed the argument brought by Mr Gordon that Ten's adminstrators' KordaMentha did not give creditors sufficient information about the CBS bid when they recommended it to Ten creditors.
The court challenge came after KordaMentha urged creditors of the stricken Ten to support CBS's surprise August 28 bid on September 4, then produced a second report on September 11 after complaints from Mr Gordon and his co-bidder Lachlan Murdoch over the administrators' presentation of the rival bid to creditors.
Mr Murdoch and Mr Gordon - through their respective investment vehicles Illyria and Birketu - launched a takeover bid for Ten in late August only to be trumped by CBS.
The local pair then delivered a revised late bid to Ten's administrators on September 15, offering unsecured creditors up to $55 million compared to $32 million offered by CBS.
Justice Ashley Black on Monday ruled in favour of KordaMentha's actions finding that Mr Gordon and Mr Murdoch's initial offer for Ten was both riskier than CBS, "highly conditional," and had lapsed following the expiry of a $200 million loan facility Ten held with Commonwealth Bank.
"The offer was highly conditional, had expired by the time that report (to creditors) was issued and was not capable of implementation because it was premised on the CBA Loan Facility continuing, which has now been discharged and expired," Justice Black said.
Birketu and WIN Corporation - Mr Gordon's Ten-affiliated free-to-air regional network - were ordered to pay costs after Justice Black found KordaMentha did provide creditors enough information on the Birketu-Illyria bid.
A further appeal is now likely, with The Australian newspaper reporting on Monday that Mr Gordon and Mr Murdoch were readying an appeal to the Supreme Court decision.
Ten went into voluntary administration in June after being unable to renew the $200 million loan facility, which was guaranteed by Mr Murdoch, Mr Gordon and Crown owner James Packer before the trio withdrew support.
With the facility expired, Mr Murdoch and Mr Gordon are no longer Ten creditors and have no voting rights in a key creditors meeting to be held in Sydney on Tuesday.
US broadcast giant CBS and Ten employees will have the biggest influence in voting and will play a key role in a vote to decide whether to adjourn the meeting or proceed with a vote on rival offers.
21st Century Fox, of which Mr Murdoch is co-executive chairman, and CBS are Ten's largest creditors.
They are owed $195 million and $348 million respectively from content deals with Ten that have been a significant factor in the financial problems that drove the network into administration.