Opinion
Case No. 04-12576-RS.
May 15, 2007
DONALD R. LASSMAN, Chapter 7 Trustee of STM Industries, Inc., By his attorneys, Alex F. Mattera, BBO No. 641760, McCarter English, LLP, Boston, MA.
REPORT AND HEARING AGENDA
Donald R. Lassman, the duly-appointed chapter 7 trustee (the "Trustee") in the bankruptcy case of STM Industries, Inc. (the "Debtor"), pursuant to sections 502, 505, 506, 507, and 704(a)(5) of the United States Bankruptcy Code, Rule 3007 of the Federal Rules of Bankruptcy Procedure (the "Bankruptcy Rules"), and Massachusetts Local Bankruptcy Rule ("MLBR") 3007-1, respectfully submits his report and hearing agenda concerning the Trustee's First Omnibus Objection to Claims (the "Objection") dated March 2, 2007.
Objections to Which the Trustee Received No Response
1. No valid responses to the Objection were filed or served on the Trustee. The Trustee recommends that the Court dispose of the claims to which the Trustee objected, and to which no response was timely filed, in accordance with the treatment proposed in the attached order.
Objections Which the Trustee has Settled
2. The Trustee has informally negotiated the resolution of his objections to the claims of various creditors against the estate. In many events, the Trustee objected to such claims on the grounds that, inter alia, the claims varied from the Debtor's books and records. The Trustee has requested and received support for such claims from various claimants, and has determined that such claims should be allowed as a general unsecured claim in the amount filed or in a mutually agreeable reduced amount.
3. The Trustee has also resolved the claims of the Debtor's secured lender, TD Banknorth ("TDBN"), successor to Boston Federal Savings Bank. Pursuant to the agreement of the parties, TDBN shall have the following:
a. An allowed secured claim in the amount of $235,000.00;
b. An allowed unsecured claim in the amount of $104,000.00, which claim shall be subordinated to the allowed claims of all other unsecured creditors until such time as the Trustee has distributed funds to such claim holders in an amount not less than $75,000.
Objections to Which the Trustee Received a Response
4. The Trustee has received a filed response to his Objection to the claims of:
a. Massachusetts Department of Revenue (the "MDOR") — The MDOR has asserted two claims against the estate: (i) Claim No. 15 as an administrative claim on account of postpetition corporate excise taxes owed by the Debtor; and (ii) Claim No. 18 as both priority and general unsecured claims on account of prepetition corporate excise taxes owed by the Debtor.
b. New England Die Cutting, Inc. ("NEDC") — NEDC has asserted a claim in the amount of $67,519.60 on account of a prepetition judgment against the Debtor. NEDC's claim included interest, but did not provide a breakdown of the interest calculation. Accordingly, the Trustee opposed NEDC's claim, and sought to reduce it to the judgment amount of $42,721.52.
5. The Trustee has reviewed the MDOR claims and determined that they are valid and not duplicative. Accordingly, the Trustee withdraws his objections to the MDOR claims and requests that the claims of the MDOR be allowed as set forth in the proposed order.
6. The Trustee and NEDC have reached an amicable resolution regarding NEDC's claims. NEDC has provided interest calculations reflecting interest on its judgment for the prepetition period only. Accordingly, the Trustee requests that the claims of NEDC be allowed as set forth in the proposed order.
WHEREFORE, for all for forgoing reasons, the Trustee requests that the Court: (i) enter the proposed Order attached hereto; and (ii) grant such other and further relief as just and necessary.
ORDER SUSTAINING TRUSTEE'S FIRST OMNIBUS OBJECTION TO PROOFS OF CLAIM
Pursuant to the First Omnibus Objection to Claims (the "Objection") of Donald R. Lassman, the duly-appointed chapter 7 trustee (the "Trustee") of STM Industries, Inc. (the "Debtor"), seeking an Order, pursuant to sections 502, 506, 507, and 704(a)(5) of title 11 of the United States Code (the "Bankruptcy Code"), as complemented by Rules 3002 and 3007 of the Federal Rules of Bankruptcy Procedure (the "Bankruptcy Rules"), and Massachusetts Local Banrkuptcy Rule ("MLBR") 3007-1; and after consideration of the Objection, Exhibit A thereto; and any responses having been filed thereto; and upon the full record of the hearing, if any, and all prior proceedings in this case; and after due diligence and sufficient cause appearing therefor, it is hereby
FOUND THAT:
a) Notice of the Objection has been provided as set forth in the Objection, and no other or further notice is necessary or required.
b) The relief requested in the Objection is in the best interests of the Debtor, the Estate, creditors and other parties in interest; and it is thereforeORDERED, ADJUDGED AND DECREED THAT:
1) Pursuant to sections 502, 506, 507, and 704(a)(5) of the Bankruptcy Code, as complemented by Bankruptcy Rules 3002 and 3007, and MLBR 3007-1, the Claims are either: (a) disallowed in their entirety; (b) reduced and allowed as indicated on Exhibit A hereto; or (c) allowed as filed. The Allowed Amount of such claims is set forth on Exhibit A.
2) This Order is without prejudice to the Trustee's right to object to the Claims subject to the Objection hereto on grounds other than as stated in the Objection and is without prejudice to the Trustee's right to object on any grounds as to any and all other Claims filed herein, including any other Claims held by the Claimants whose Claims are disallowed and expunged and/or reduced and allowed hereunder.
SO ORDERED. EXHIBIT A Claim Claim Claimant No. Claim Amount Characterization
The unsecured claim of TD Banknorth, successor to Boston Federal Savings Bank ("TDBN"), in the amount of $104,000 (the "TDBN Claim") shall be subordinated to all allowed unsecured claims and shall receive no payment until all other claims receive payments in the aggregate amount of $75,000, after which all allowed general unsecured claims, including the TDBN claim, shall receive pro rata distributions from any available funds.