This evening – Sunday, December 28, 2008 – we received an email from Paul Sugarman of the Heller Ehrman Dissolution Committee. Adressed to all former employees, the email contains an attachment outlining Heller’s decision to file for Chapter 11 bankruptcy. [Note: since the memo itself is undated, it is assumed that the filing will be made on Monday, December 29, 2008 or has already been made]
While the Dissolution Committee emphatically reiterates that it has not run out of money and that they still expect to collect “tens of millions of additional dollars,” the memo places blame on Heller’s creditors – namely, Bank of America, Citibank and as of late, 333 Bush Associates.
One glimmer of hope is that by filing on or before December 30, 2008, the Bankruptcy Court may take the position of “voiding the banks’ security interest” due to the manner in which the banks had released their security interest via UCC filing more than a year ago yet did not file a new UCC statement until October 2008, according to the memo.
Additionally, the Dissolution Committee goes through great lengths to explain the process in which 333 Bush Associates was issued a Writ of Attachment last week in San Francisco Superior Court (reported at Heller Highwater here last week) and how it has impacted the decision to file for bankruptcy.
While the closing paragraphs of the memo indicate that the Dissolution Committee has every intention of continuing to wind down operations as “debtor in possession” and to communicate with former employees as to the status of the Chapter 11 filing, ex-Hellerites can continue to follow this issue here at Heller Highwater. I’ll keep you informed as to how you can participate in the bankruptcy process and make sure that all former employees receive the accrued wages and other monies due them.