Chakra Discussions

ISKCON Chapter 11 Update - November 2003

by Gupta das (Joseph Fedorowsky)

Posted November 26, 2003

Since August 15, 2003, the cutoff date for filing a claim in the Chapter 11 cases, the focus has been on claims processing, debtor asset assessment, formulation of a Reorganization Plan and insurance litigation.

After accounting for duplicate filings, over 500 Gurukuli claimants have been identified in the California and West Virginia bankruptcy reorganization cases. All of those claims are now being sorted and a database is being developed to efficiently handle the massive amount of information which must be evaluated.

Meanwhile, a far reaching and financially complex assessment of the debtors' assets for reorganization purposes is taking place. This financial assessment, which must be completed by the specialized accounting firms involved before a Reorganization Plan can be finalized, is almost done. As can well be imagined, a Reorganization Plan which describes how disbursements will be made must account for and balance many complex variables.

It is anticipated that a Reorganization Plan will be readied for filing by the end of the year, although that could change if the financial assessment takes a bit longer than expected. However, a great deal of progress on the Reorganization Plan has been made and many of the non-financial Plan components have already been drafted.

Concurrently, complex insurance litigation is taking place in U.S. District Court, the results of which will directly impact the Reorganization Plan. The hope here is that a number of insurance policies will increase the total amount of the victims fund. This insurance litigation is in an early phase so firm conclusions cannot yet be drawn. Meanwhile, formal discovery to gather additional information from the claimants will begin soon.

The Chapter 11 bankruptcy process is somewhat flexible, and the timeline for the case continues to be adjusted in response to the claims, asset and litigation picture. However, considering the informational, legal and financial complexities involved, steady progress is being made. Once the Plan of Reorganization is filed another update will be circulated. Thank you for your patience.