DISH UCC Seeks Standing to Avoid Transfer of Boost Mobile to Nondebtor EchoStar Affiliates, Signals Intent to Challenge $8.8B DISH DBS Intercompany Claim on Section 502(d) Grounds

Relevant Documents:
Motion for Standing
Proposed Complaint

In a motion filed Aug. 7, the DISH DBS/DISH Wireless official committee of unsecured creditors seeks standing to sue parent EchoStar to recover the value of the transferred Boost Mobile business and use the avoidance claims to object to allowance of an $8.8 billion intercompany claim against DISH Wireless under section 502(d) of the Bankruptcy Code. The UCC estimates the value of the Boost business, and thus potential damages, at “billions of dollars.”

The debtors maintain DISH Wireless received reasonably equivalent value for the Boost transfer, namely reduction of the now $8.8 billion DISH DBS intercompany claim to $14 billion from more than $19 billion. The committee says this claim was “manufactured” in August 2025 and contributed to a trust for DISH DBS creditors solely to rig voting on the DISH debtors’ prepackaged plan and deprive DISH Wireless trade creditors of “access to billions of dollars in value.”

Prior to August 2025, the committee says, the “undocumented” capital expenditure underpinning the alleged intercompany loan were always treated as equity investments, and “forgiveness” of equity contributions cannot qualify as reasonably equivalent value for the loss of Boost. “For five years,” EchoStar affiliate DISH Network “never demanded repayment and did not treat the contributions as loans,” the UCC points out.

Rather than serving as commercial, arms-length transactions negotiated by responsible fiduciaries, the documentation of the intercompany loan and related Boost transfer epitomize EchoStar’s “egregious and improper behavior leading up to and continuing through the commencement of these cases,” the committee argues.

The UCC also requests standing on an emergency basis to challenge the allowance of the intercompany claim for plan voting purposes under section 502(d) of the Bankruptcy Code, which requires disallowance of any claim of any entity that received an avoidable transfer and refuses to return the property or value transferred.

“The Proposed Claims are integral to the Bankruptcy Code section 502(d) argument the Committee intends to make in connection with challenging the Alleged DWLLC Intercompany Loan Claim, and the Debtors have inexplicably asserted that they will attempt to prevent the Committee from asserting these claims,” the UCC says.

The committee also points out that the debtors intend to transfer their claims against EchoStar related to the Boost transaction to EchoStar for a “paltry” $300 million, effectively giving EchoStar a heavily-discounted release. According to the UCC, the debtors’ refusal to sue EchoStar instead of giving it a release for an unreasonable low amount demonstrates that DISH Wireless’ supposedly independent directors are in fact “conflicted.”

Creditors of another EchoStar affiliate, Hughes Satellite Systems, have made similar arguments regarding the purported independence of those debtors’ independent directors in the Hughes chapter 11 case, which was filed about one month after the DISH case. In both cases, creditors accuse EchoStar CEO Charles Ergen of manipulating affiliates’ assets to minimize certain creditors’ recoveries and appointing “professional” independent directors to whitewash potential claims.