Opinion
Case No. 302-08915 (Substantively Consolidated)
January 16, 2004
ORDER
This matter is before the court on the Bank of Montreal for itself and as Administrative Agent for the Senior Secured Lenders' ("Lenders") motion to alter or amend the court's December 12, 2003 Memorandum and December 31, 2003 Order. The motion asks the court to reconsider its damage calculation based upon New York Uniform Commercial Code, and to consider all relevant facts about the pending appeal of the confirmation order if the scope of appeal is germane to the court's warrant issue determination. For the reasons contained herein, the Lender's motion is granted in part and denied in part.
The motion states that the court improperly considered the scope of the Lender's appeal of the order confirming the debtor's chapter 11 plan. In a footnote the court hinted that "it is almost counter-intuitive" that the Lenders continue to contest confirmation on appeal based it least in part on an attack on Houlihan Lokey's expert opinion, and yet rely on those numbers for purposes of the warrant issue. The court's comment was based upon judicial knowledge and familiarity of the hard-fought battle in this case, and not with any specific comment on the proof. However, out of an abundance of caution, the court will strike footnote 6 from its Memorandum Opinion.
The motion also asks the court to address the Lenders' damages argument under the New York Uniform Commercial Code. The Lenders posit that because the Warrant Agreement is governed by New York law, the court should apply the New York Uniform Commercial Code and find that the damages resulting from rejection are $6,987,774. 10. The court should, according to the Lenders, either reconsider damages under the New York Commercial Code or specifically dispose of this argument.
The Lenders' Post-Trial Brief provided as follows on the proper method to calculate damages in this case;
Based on the record presented at the hearing, the Court can determine damages by relying on the expert testimony of Richard Braun of FTI Consulting ("FTI"), or by referring to applicable New York law.
Post-Trial Brief of Lenders, page 6 (emphasis in original). The court chose to determine damages based upon the expert testimony of Mr. Michael Collins, instead of the Lenders' expert, Mr. Richard Braun. The Lenders cannot now argue that the court could choose their expert testimony as a proper calculation of damages but not the debtor's expert. The court considered the calculation of damages under applicable New York law, but instead relied upon Mr. Collins' testimony.
By the Lender's own Post-Trial Brief, it is apparent that the Court had options as to the calculation of damages. To the extent the Lenders seek an order that alters or amends this court's prior damages calculation, such is DENIED. To the extent that the Lenders seek a clarification of whether all issues of have been ruled upon, that motion is GRANTED. All issues have been considered and ruled upon.