Kodak seeks end to bankruptcy, again
Here's what $245.2 million will get you nowadays:
• 15,300 new Ford Focuses, one for every person in the town of Parma.
• 2.5 million orders of 55 Junker Plates and root beers from Tom Wahl's.
• Or one Eastman Kodak Co. bankruptcy.
The company earlier this month filed with U.S. Bankruptcy Court what it believes to be the final tally of costs for its Chapter 11 bankruptcy, as well as a motion asking the final closing of the case. That $245.2 million is $2.1 million more than the mountain of $243.1 million worth of bills presented to the court in November 2013.
Kodak semi-officially ended its bankruptcy in September 2013 when its reorganization plan took effect. That moment saw the company selling off its Personalized Imaging and Digital Imaging businesses to a British pension fund, cancel out all its existing stock, and issue new shares to an array of parties holding IOUs, from the financiers who helped pay for Kodak's bankruptcy to the legions of creditors left with unpaid bills when the company filed for protection.
But that moment didn't mean the end to bankruptcy as a legal case. Since then, the Kodak General Unsecured Creditors Trust has been suing numerous firms that did business with Kodak before the bankruptcy, seeking to claw back some of the money Kodak spent in those pre-bankruptcy weeks to then divide it up among various unsecured creditors. The court also has continued to rule on cases where Kodak objected to some of the 7,000 claims and requests for payment that had been filed against it. And during all this time, Kodak has been paying out what it had been ordered to pay as part of its reorganization plan.
According to the motion, Kodak has paid out some stock and stock warrants to holders of unsecured claims, and expects to do one final payout of yet more.
Even if the court approves Kodak's motion, that still wouldn't mean the end of everything bankruptcy related. As Kodak argues in its motion, bankruptcy rules let courts determine that a bankruptcy should be closed even though there might still be future actions or payments involving the debtor and its creditors. And in Kodak's case, there's still some legal work to be done in the form of roughly 220 outstanding General Unsecured Creditors Trust cases involving those attempted clawbacks.
"The entry of a final decree is essentially an administrative task," Kodak argues in its motion.
Such a motion would also let Kodak quit paying Kurtzman Carson Consultants LLC as the party responsible for a lot of the administrative paperwork of the bankruptcy, and speed up making that final payout to unsecured claims.
A hearing on the order is scheduled for Dec. 9 in U.S. Bankruptcy Court in New York City.
That $245.2 million went to 28 different firms in the form of legal, accounting, and consulting fees, as well as various expenses.
The biggest bill Kodak had to pay during its 20-month bankruptcy was to New York law firm Sullivan & Cromwell LLP, which was Kodak's main legal counsel during the bankruptcy. Sullivan & Cromwell received $61.9 million in fees, plus $762,000 in expenses. Other major billers included accounting giant Ernst & Young LLP ($33.5 million in fees plus $1.9 million in expenses), and auditor PricewaterhouseCoopers LLP receiving $31.9 million in fees and $1.6 million in expenses.
MDANEMAN@DemocratandChronicle.com