Saturday, June 27, 2009
By Nicole Bullock
Published: June 27 2009 03:00 Last updated: June 27 2009 03:00
This weekend, Oliver Addison Parker will board a plane from Fort Lauderdale to New York. Mr Parker, a trial lawyer and General Motors bondholder, is en route to hearings on the company's restructuring to argue his case himself in federal bankruptcy court.
The issue highlights the difficulty individual bondholders face when competing against larger, better connected groups. Top lawyers for GM and the unsecured creditors' committee charge rates of more than $900 an hour.
The high fees and the difficulty of mobilising opposition mean that individuals, including the dealers, have gained publicity and sympathy on Capitol Hill but not so much in bankruptcy court.
The small bondholders, undaunted, intend to continue their challenge. The unofficial committee has been gathering donations through a website to pay legal costs. Michael Richman of Patton Boggs is representing them. They will argue that the fast-track sale is unjustified and push for a traditional Chapter 11 reorganisation, which they believe will give them more balanced treatment with the unions.
"We have enough to fund [the case] through our objections and we are working on funding it beyond that," says Mark Modica, a manager at a Saturn dealership. "We're still in a fight."
Thursday, June 25, 2009
GM Update: Dissident Bondholders Not Backing Down
"Richman will get his chance to question the sales plan starting Tuesday (June 30), when GM and its legal team at Weil, Gotshal & Manges call a number of high-powered executives, including former GM chief executive Fritz Henderson, to the witness stand to testify in favor of the proposed sales plan. Richman say he plans to question them aggressively about the plan."
Tuesday, June 23, 2009
In bankruptcy cases, official committees can have their fees paid for by the bankrupt company rather than having to come up with the money themselves.
The group's lawyer, Michael Richman, of the Patton Boggs law firm, argued that an official committee was necessary because his clients -- many of them retirees and individual families -- had limited means and that the bondholders were a large disparate group.
"Some people think we are insane to be standing in the way of this process, but this is about adequate representation," Richman told the court.
Richman told reporters after the hearing it was "likely" his clients would continue to object to GM's fast track sale, but he was unsure what they would be able to do given their spending limits. Richman said he was planning to meet the official committee of unsecured creditors to see if they would adopt any of the objections his group has raised.
See Also: Judge Shoots Down Plea for Extra GM Bondholders Committee
After the hearing, Richman said he will likely press on with the bondholders' objection to the sales plan, but that he's not sure how the bondholders will pay for continued high quality legal representation. "It's a challenge of resources," he says.
Monday, June 22, 2009
What can you do--write to:
The Honorable Robert E. Gerber
Case No. 09-50026 (REG)
I just spoke with the bankruptcy court, you can still send your objections; include a cover letter indicating your notification was late.