Misery Index: Week of August 7, 2017

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PacerMonitor’s look back at this week's most compelling bankruptcies

Chemical Fluid Reprocessor Stops Debt Drain in Bankruptcy

CRS Reprocessing LLC sought to plug the money leak of up to $100 million in liabilities in the Western District of Kentucky. Signed by CEO Scott T. Massie, the chapter 11 petition disclosed that $12,267,992 is owed to THL Credit and $7,167,530 is owed to Harvest Capital Credit. According to court records, the bankruptcy is due to ongoing disputes among lenders and lack of liquidity.

Read the declaration of Mr. Massie here.

Sex Toy Retailer Makes Its Bed in Bankruptcy Court

Peekay Acquisition LLC and 16 affiliates sought to shelve up to $100 million in liabilities, of which $5,609,168.27 in unsecured notes is owed to founder Kris Butt.

The chapter 11 petition was filed in the District of Delaware. Affiliates Condom Revolution and Peekay Boutiques Inc also filed on August 10. According to court records, the bankruptcy is a result of being unable to effectuate its IPO and secure sufficient cash to satisfy debts.

Read Mr. Altro’s declaration here.


Federal Investigation of Texas Pharmacy Leads to Bankruptcy

N214FT LLC sought protection from up to $10 million in debts in the Northern District of Texas. The chapter 11 petition was signed by manager and board member Dustin Rall at RXpress Pharmacy, which was accused of paying illegal kickbacks to physicians for writing prescriptions, according to media reports.

Embattled Luxury Resort Succumbs to Pressure From Creditors

After suing Pontwelly Holding Company Limited for allegedly illegally foreclosing on its property, Aman Resorts Group Limited sought protection from up to $10 million in liabilities in the Southern District of Florida. The chapter 11 petition discloses that an involuntary bankruptcy pleading signed by venture capitalist Omar Amanat had been launched against the company last year. In April 2017, an involuntary petition was also filed against affiliate Peak Hotels and Resorts Group, Ltd.

Read the 2016 federal complaint against Pontwelly Holding Company Limited here

Louisiana Real Estate Holding Company Falters After Bank Suit

Formosa Plantation LLC sought protection in the Western District of Louisiana. Signed by Member Anthony J. Guilbeau Jr., the chapter 11 petition listed up to $10 million in liabilities, of which $2,264,349.09 is owed to Guilbeau Marine and a disputed $3.5 million loan is owed to South Lafourche Bank and Trust. Formosa Plantation was among Plaintiffs that sued South Lafourche Bank for a 2015 loan restructuring agreement that was allegedly fraudulent.

Read the lawsuit filed against South Lafourche bank here.

PenAir Crash Lands Into Bankruptcy

Blaming a portion of its declining financial performance on airport hubs in Portland and Denver, Peninsula Airways sought protection from up to $50 million in assets and liabilities of which $1,325,464.76 is owed to the State of Alaska for landing fees. The chapter 11 petition, signed by President Daniel P. Seybert, was filed in the District of Alaska.

Read declaration of COO David M.Richards here

Knight Energy Holdings Seeks Protection After Racketeering Charges

Formerly known as Knight Well Services, Knight Energy Holdings LLC and 14 affiliates sought protection from up to $500 million in liabilities in the Western District of Louisiana. Signed by authorized representative Kelly Knight Sobiesk, affiliates that filed chapter 11 petitions include Knight AviationKnight Family Enterprises and Knight Oil Tools LLC whose former executive Mark Knight was arrested on racketeering charges, according to media reports.

Pennsylvania Fire House Ignites Second Bankruptcy

Conneaut Lake Volunteer Fire Department of Conneaut Lake Borough and Sadsbury Township sought to put out the spark of up to $10 million in assets and liabilities. President Timothy Latta, signed the chapter 11 petition, which disclosed that a $1,589,000.00 partially secured claim is owed to Mercer County State Bank. The fire department had originally filed a bankruptcy petition in January 2016.

Read a court order from the first bankruptcy here.

After Class Action, Ohio Felon’s Firm Begins Bankruptcy

After being sued for violating the Telephone Consumer Protection Act, SCI Direct LLC and three affiliates sought protection from up to $50 million in liabilities, of which $5,304,113.76 is owed to Restless Noggins Manufacturing LLC for trade debt. The chapter 11 petition, filed in the Northern District of Ohio Canton Division, was signed by CEO Ben Suarez, a businessman convicted of witness tampering in campaign finance, according to media reports.

 Read the class action suit filed against SCI Direct LLC here

Scottsdale Asian Eatery Fends off Hungry Creditors in Bankruptcy

Flo’s Restaurants, Inc. sought protection from up to $10 million in liabilities of which $1,260,658.94 is owed to Victor, Cody & Nicolas McMurry for a disputed lien. Filed in the District of Arizona, Secretary Dustin W. Wallace signed the chapter 11 petition, which noted that affiliates Flo’s Second LLC and Flo’s LLC also filed pleadings.

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