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Caesars Entertainment shares crater as bondholder lawsuits loom

Video slot machines at Caesars Palace in Las Vegas, Nevada.
George Rose | Getty Images

Shares of Caesars Entertainment briefly dropped more than 20 percent in Monday morning trade after a U.S. Bankruptcy Court ruling late Friday said the firm cannot protect itself from bondholder lawsuits.

The stock later recovered some of its losses and ended the day down 15 percent.

The cases seek some $11 billion in claims, which Caesars said could force it into bankruptcy protection. Its operating unit CEOC filed for bankruptcy protection in early 2015 and was asking for a third shield so its parent could contribute billions to a reorganization plan, Reuters said.

"Both Caesars Entertainment and CEOC are disappointed by the Bankruptcy Court's refusal to continue to stay the guarantee litigation against Caesars Entertainment," Caesars' spokesman Stephen Cohen said in an emailed statement to CNBC.