Post by ferryfast admin on Mar 7, 2006 23:34:14 GMT -5
Some ferry claims settled
Judge doles out partial awards to creditors large and small
Brian Sharp
Staff writer
Democrat & Chronicle
www.democratandchronicle.com/
(March 7, 2006) — Settling up on high-speed ferry debts continues with a judge ruling Monday on how to pay 192 claims filed in the wake left by former operator Canadian American Transportation Systems.
CATS owned and operated the ship in 2004. Total claims topped $2.7 million, far exceeding the $700,000 creditors' fund set aside when the city bought the ship at auction in February 2005.
"Anything is better than nothing," said Horseshoe Hospitality owner Kurt Ritchie, the ship's caterer and gift shop operator.
Ritchie filed a claim for $80,670 for debts under CATS and was awarded $60,370. He took another hit when the city pulled the plug on Rochester-to-Toronto ferry service in January of this year and began settling up on debts from this past year. Ritchie sold off merchandise and kitchen equipment last month to repay creditors for unspecified losses.
Katrina Dudley's claim was for $1,268. She will receive $949. For the married mother of two, ages 6 and 9, it's a relief to know her work and time away from her children wasn't for nothing. Dudley worked on interior displays and researched a historical exhibit on Lake Ontario ferries that was never used.
"I just thought, you know, they are never going to pay me," she said. "I just sort of wrote it off."
Dudley's husband worked for a firm that sold $15,000 in signage and labor to CATS. That firm has since gone out of business.
As part of a settlement agreement negotiated before it bought the ship, the city agreed to create a $700,000 creditors' fund to pay off at least a portion of CATS' creditors. The court was then to administer the fund.
Magistrate Judge Jonathan W. Feldman created a six-tier payment schedule awarding 100 percent of claim amounts to employees and individuals, dropping significantly to small, medium and large businesses to end at 11 percent for professional firms. Payments will be issued after March 20, the deadline for anyone choosing to reject their award and seek other options.
Michael Beyma, a lawyer with the firm representing original ferry lender ABN AMRO, said the past year involved more than just receiving claims and devising a payment formula. Claims had to be verified. Many required additional information. A few, including a claim by ship builder Austal Ltd., was not paid. The judge rejected Austal's claim (the amount of which was not stated in the ruling) because Austal was a shareholder in CATS. Anyone with an affiliation with government also received nothing.
"It was not meant to pay everybody in full," Beyma said, explaining the $700,000 was an amount offered by the city. "I think it's pretty unique. In most instances like this unsecured creditors get zero."
The judge still was talking to claimants as recently as last week, Beyma said, and tweaking payment percentages on Friday afternoon. Legal and communications firms lost some of the most money on CATS. Blank Rome LLP, a Pennsylvania-based law firm, filed a claim for nearly $250,000 and was awarded $26,700. Frontier Communications sought $77,270 and received $11,590. Beyma worked for free on the case.
"As part of the settlement agreement," Beyma said, "the city decided that smaller creditors and smaller businesses that might not have known the financial danger they were in should recoup as much of their losses as possible."
BDSHARP@DemocratandChronicle.com
Judge doles out partial awards to creditors large and small
Brian Sharp
Staff writer
Democrat & Chronicle
www.democratandchronicle.com/
(March 7, 2006) — Settling up on high-speed ferry debts continues with a judge ruling Monday on how to pay 192 claims filed in the wake left by former operator Canadian American Transportation Systems.
CATS owned and operated the ship in 2004. Total claims topped $2.7 million, far exceeding the $700,000 creditors' fund set aside when the city bought the ship at auction in February 2005.
"Anything is better than nothing," said Horseshoe Hospitality owner Kurt Ritchie, the ship's caterer and gift shop operator.
Ritchie filed a claim for $80,670 for debts under CATS and was awarded $60,370. He took another hit when the city pulled the plug on Rochester-to-Toronto ferry service in January of this year and began settling up on debts from this past year. Ritchie sold off merchandise and kitchen equipment last month to repay creditors for unspecified losses.
Katrina Dudley's claim was for $1,268. She will receive $949. For the married mother of two, ages 6 and 9, it's a relief to know her work and time away from her children wasn't for nothing. Dudley worked on interior displays and researched a historical exhibit on Lake Ontario ferries that was never used.
"I just thought, you know, they are never going to pay me," she said. "I just sort of wrote it off."
Dudley's husband worked for a firm that sold $15,000 in signage and labor to CATS. That firm has since gone out of business.
As part of a settlement agreement negotiated before it bought the ship, the city agreed to create a $700,000 creditors' fund to pay off at least a portion of CATS' creditors. The court was then to administer the fund.
Magistrate Judge Jonathan W. Feldman created a six-tier payment schedule awarding 100 percent of claim amounts to employees and individuals, dropping significantly to small, medium and large businesses to end at 11 percent for professional firms. Payments will be issued after March 20, the deadline for anyone choosing to reject their award and seek other options.
Michael Beyma, a lawyer with the firm representing original ferry lender ABN AMRO, said the past year involved more than just receiving claims and devising a payment formula. Claims had to be verified. Many required additional information. A few, including a claim by ship builder Austal Ltd., was not paid. The judge rejected Austal's claim (the amount of which was not stated in the ruling) because Austal was a shareholder in CATS. Anyone with an affiliation with government also received nothing.
"It was not meant to pay everybody in full," Beyma said, explaining the $700,000 was an amount offered by the city. "I think it's pretty unique. In most instances like this unsecured creditors get zero."
The judge still was talking to claimants as recently as last week, Beyma said, and tweaking payment percentages on Friday afternoon. Legal and communications firms lost some of the most money on CATS. Blank Rome LLP, a Pennsylvania-based law firm, filed a claim for nearly $250,000 and was awarded $26,700. Frontier Communications sought $77,270 and received $11,590. Beyma worked for free on the case.
"As part of the settlement agreement," Beyma said, "the city decided that smaller creditors and smaller businesses that might not have known the financial danger they were in should recoup as much of their losses as possible."
BDSHARP@DemocratandChronicle.com