BANKRUPTCY COURT ; Freedom Finish Coming Soon; Money for Creditors, Class-Action Lawsuits; Limited, Judge Says
Gutman, David, The Charleston Gazette (Charleston, WV)
What has seemed inevitable for weeks was made official today: Freedom Industries will soon be finished as a company.
Mark Freedlander, a lawyer representing Freedom, told U.S. Bankruptcy Court Friday morning that the company responsible for contaminating the water of 300,000 West Virginians will wind up its affairs - including environmental remediation - and then begin sending all its customers to its former competitors.
That will happen "sooner rather than later," Freedlander said.
All of Freedom's remaining chemical inventory will be sold in a matter of days, he said.
"It just became apparent in relatively short order," Freedlander said, "that it was not practical or financially viable" to continue operating the company.
Freedom was represented at Friday's bankruptcy hearing only by its lawyers. No company executives attended.
In a news release issued after the hearing, Gary Southern, Freedom's president, said that selling the company's inventory and shifting its business to competitors "represents Freedom's best opportunity to generate funds it needs for our environmental remediation efforts."
Southern said the company would do its best to help its employees find jobs with competitors, although job losses are inevitable.
In late January, Freedom agreed to an order from the state Department of Environmental Protection to begin tearing down its facility on the Elk River by March 15.
Dozens of class-action lawsuits filed against Freedom are on hold while the bankruptcy process plays out. Today's announcement made clear what was already apparent - the pool of money for those lawsuits, and for all of Freedom's hundreds of creditors, will be limited.
"Based on what we've heard announced today, there's a serious limit on funding available," U.S. Bankruptcy Judge Ronald G. Pearson told the court.
Pearson recommended that plaintiffs' lawyers and Freedom's lawyers work together to come up with a standardized claim form for people seeking damages from Freedom for things such as lost wages and lost business, to try to preserve Freedom from excessive legal costs.
Freedom estimates it will pay more than $700,000 in legal and financial advising fees in the next three weeks, according to bankruptcy filings. …