Gibson Brands Headlines Latest Bankruptcy Batch of Big Law Creditors
The iconic maker of guitars, pianos and other musical instruments owes nearly $140,000 to one large firm. But a candy company, the nation's largest gun-maker and controversial health institute are also stiffing attorneys from the Am Law 100.
May 01, 2018 at 08:27 PM
5 minute read
What better company than Gibson Brands Inc., manufacturer of the legendary Les Paul guitar, to play a somber tune in an ode to law firms looking at unpaid bills?
Gibson Brands filed for bankruptcy Monday in Delaware as part of a restructuring deal that will see lenders take control of the iconic maker of guitars, pianos and other musical instruments. According to a list of Gibson Brands' 30 largest unsecured creditors, the debtor owes $139,144 to White & Case, a firm that has done some restructuring work for the Nashville-based company.
Goodwin Procter and Pepper Hamilton are advising Gibson Brands in its Chapter 11 case. Neither firm has yet filed billing statements with the bankruptcy court. The financial collapse of the company, which was founded in 1894 and is currently owned by executives Henry Juszkiewicz and David Berryman, comes after a failed attempt to expand into other business lines and a continued decline in the annual sales of guitars. In court papers, Gibson Brands lists up to $500 million in debt.
Paul, Weiss, Rifkind, Wharton & Garrison is advising an ad hoc group of noteholders supporting Gibson Brands' restructuring plan. According to news reports, Silver Point Capital LP, Melody Capital Partners LP and funds affiliated with an investment advisory unit of buyout giant KKR & Co. LP are the stakeholders poised to take control of Gibson Brands, which hopes to conclude its bankruptcy proceedings by September.
Gibson Brands, whose general counsel is Bruce Mitchell, joins a string of struggling companies that have filed for bankruptcy in recent months and left firms of all sizes holding out hope for delinquent bills to disappear. Within the past few weeks, several more companies have slipped into insolvency and created a procession of unpaid attorneys.
In late March, just after The Weinstein Co. Holdings LLC left a trail of Big Law creditors in its bankruptcy wake in Delaware, the oldest U.S. gun-maker also sought Chapter 11 protection in the First State.
Remington Outdoor Co. Inc. is once again being advised by lawyers from Milbank, Tweed, Hadley & McCloy and Lowenstein Sandler, as well as national bankruptcy boutique Pachulski Stang Ziehl & Jones. Chicago's Swanson, Martin & Bell is representing Madison, North Carolina-based Remington, formerly known as Freedom Group Inc., in litigation with families of the 26 people killed by Adam Lanza in the horrific December 2014 mass shooting in Sandy Hook, Connecticut. On a tally of Remington's 30 largest unsecured creditors, Swanson Martin is listed as being owed $387,023.30.
Philadelphia-based Zitner Candy Corp., known for its chocolate-covered Easter eggs and other delicious treats, filed for bankruptcy in its home city in late April, owing $486,000 to local personal injury lawyer Kenneth Schuster; $24,670.75 to Duane Morris Government Strategies; and $3,267.95 to Duane Morris itself, according to court filings. Schuster and fellow local lawyer Evan Prochniak bought Zitner back in 2010, but Prochniak and his wife filed for personal bankruptcy last month.
Solar mounting systems maker Schletter Inc., advised by Moore & Van Allen, filed for bankruptcy last week, listing a $429,114.94 debt to Orrick, Herrington & Sutcliffe in its Chapter 11 case in Shelby, North Carolina. Englewood, Colorado-based Tempus Aircraft Sales and Service LLC also filed for bankruptcy last week in Denver. The company states in court records that it owes $81,535.12 to Chicago aviation litigator Fred Begy III, who once practiced at a Locke Lord predecessor firm before flying out on his own.
Houston-based Erin Energy Corp., an oil and gas producer that focuses its investments on sub-Saharan Africa, filed for bankruptcy last week in its home city. The company owes $530,860.22 to Baker Botts; $180,600.59 to Norton Rose Fulbright; $115,618.48 to Jackson Walker; $62,230.90 to The Loev Law Firm in Bellaire, Texas; and $23,959.99 to Houston's Looper Goodwine, according to court records. The Love Law Firm is counseling Erin Energy in its Chapter 11 case, along with Houston's Okin & Adams.
Elsewhere in Texas, the Brain Energy Institute, a controversial business formerly known as Cerebrum Health Centers and Carrick Brain Centers, filed for bankruptcy in Dallas in early April. In court filings, the debtor states that it owes $53,787.92 to Holland & Hart; $31,354.51 to Dallas-based Farrow-Gillespie & Heath; $18,566.62 to Dallas-based Reese Marketos; and $2,470 to Irving, Texas-based Heygood, Orr & Pearson.
The recent bankruptcy of Parkprovo LLC, owner of the Seven Peaks Waterpark in Provo, Utah, lists a debt of $46,139.25 to Salt Lake City's Bennett, Tueller, Johnson & Deere. Holland & Hart, however, has received $75,000 from Parkprovo to advise it in Chapter 11, according to court filings.
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
NOT FOR REPRINT
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
You Might Like
View All'Further Investment in Power' Will Drive Big Law Business—But What About Clean Energy Projects?
6 minute readMorrison & Foerster Doles Out Year-End and Special Bonuses, Raises Base Compensation for Associates
Eckert Seamans Snags Reed Smith Global Financial Intelligence Director
3 minute readTrending Stories
- 1Call for Nominations: Elite Trial Lawyers 2025
- 2Senate Judiciary Dems Release Report on Supreme Court Ethics
- 3Senate Confirms Last 2 of Biden's California Judicial Nominees
- 4Morrison & Foerster Doles Out Year-End and Special Bonuses, Raises Base Compensation for Associates
- 5Tom Girardi to Surrender to Federal Authorities on Jan. 7
Who Got The Work
Michael G. Bongiorno, Andrew Scott Dulberg and Elizabeth E. Driscoll from Wilmer Cutler Pickering Hale and Dorr have stepped in to represent Symbotic Inc., an A.I.-enabled technology platform that focuses on increasing supply chain efficiency, and other defendants in a pending shareholder derivative lawsuit. The case, filed Oct. 2 in Massachusetts District Court by the Brown Law Firm on behalf of Stephen Austen, accuses certain officers and directors of misleading investors in regard to Symbotic's potential for margin growth by failing to disclose that the company was not equipped to timely deploy its systems or manage expenses through project delays. The case, assigned to U.S. District Judge Nathaniel M. Gorton, is 1:24-cv-12522, Austen v. Cohen et al.
Who Got The Work
Edmund Polubinski and Marie Killmond of Davis Polk & Wardwell have entered appearances for data platform software development company MongoDB and other defendants in a pending shareholder derivative lawsuit. The action, filed Oct. 7 in New York Southern District Court by the Brown Law Firm, accuses the company's directors and/or officers of falsely expressing confidence in the company’s restructuring of its sales incentive plan and downplaying the severity of decreases in its upfront commitments. The case is 1:24-cv-07594, Roy v. Ittycheria et al.
Who Got The Work
Amy O. Bruchs and Kurt F. Ellison of Michael Best & Friedrich have entered appearances for Epic Systems Corp. in a pending employment discrimination lawsuit. The suit was filed Sept. 7 in Wisconsin Western District Court by Levine Eisberner LLC and Siri & Glimstad on behalf of a project manager who claims that he was wrongfully terminated after applying for a religious exemption to the defendant's COVID-19 vaccine mandate. The case, assigned to U.S. Magistrate Judge Anita Marie Boor, is 3:24-cv-00630, Secker, Nathan v. Epic Systems Corporation.
Who Got The Work
David X. Sullivan, Thomas J. Finn and Gregory A. Hall from McCarter & English have entered appearances for Sunrun Installation Services in a pending civil rights lawsuit. The complaint was filed Sept. 4 in Connecticut District Court by attorney Robert M. Berke on behalf of former employee George Edward Steins, who was arrested and charged with employing an unregistered home improvement salesperson. The complaint alleges that had Sunrun informed the Connecticut Department of Consumer Protection that the plaintiff's employment had ended in 2017 and that he no longer held Sunrun's home improvement contractor license, he would not have been hit with charges, which were dismissed in May 2024. The case, assigned to U.S. District Judge Jeffrey A. Meyer, is 3:24-cv-01423, Steins v. Sunrun, Inc. et al.
Who Got The Work
Greenberg Traurig shareholder Joshua L. Raskin has entered an appearance for boohoo.com UK Ltd. in a pending patent infringement lawsuit. The suit, filed Sept. 3 in Texas Eastern District Court by Rozier Hardt McDonough on behalf of Alto Dynamics, asserts five patents related to an online shopping platform. The case, assigned to U.S. District Judge Rodney Gilstrap, is 2:24-cv-00719, Alto Dynamics, LLC v. boohoo.com UK Limited.
Featured Firms
Law Offices of Gary Martin Hays & Associates, P.C.
(470) 294-1674
Law Offices of Mark E. Salomone
(857) 444-6468
Smith & Hassler
(713) 739-1250