US Fidelis Bankruptcy Plan Could Be Finalized Today
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ST. LOUIS (KMOX)-Those owed money by the bankrupt auto warranty sales firm US Fidelis should be a step closer to getting their cash, after a hearing scheduled for this morning at the Eagleton Courthouse downtown.
At the hearing, Federal Bankruptcy Judge Charles Rendlen III will consider whether to accept a plan to disburse the assets collected from the company’s former owners, Darain and Cory Atkinson.
Creditors’ Attorney David Warfield says in a recent voting, over 410 thousand creditors accepted the plan. Six rejected it. He says what’s remarkable is that of the 30 state Attorneys General who returned ballots, all accepted the plan, “That’s highly unusual to get that many offices of that sort pulling in the same direction.”
Warfield says they agree it’s the best settlement possible, “We’re confident we obtained most of the funds Darain and Cory Atkinson had. We were able to liquidate most of their assets but in many cases it was difficult to get top dollar.”
For example, Warfield says, “Darain purchased a house for over $30 million and we were able to sell it for a little under 5 (million).”
Warfield says they have been able to collect $13 million from selling the Atkinson’s assets. He says another creditor will add $1.1 million to the total and the Attorneys General are pursuing other creditors who may contribute more plus there’s an agreement from some creditors to honor existing claims.
Warfield says it was a long hard battle to decide how to divide the money as fairly as possible, but it’s much better than the alternative, “All these consumers who had justifiable concerns about what happened to them, and legitimate claims, could have filed claims in the bankruptcy and we could have had tens of thousands, if not hundreds of thousands of people trying to go downtown to the courthouse to adjudicate their claims and no money would have gotten to the consumers. This sets up kind of an expedited way for consumers to get at least some of their money back.”
While an attorney for at least some of the six creditors who rejected the plan is expected to be in court this morning, Warfield believes Rendlen will sign off on the agreement.
He says if that happens, consumers will have until October 5 to file claims and the disbursements should start sometime next year.
Meanwhile, both Darain and Cory Atkinson are awaiting sentencing on state and federal charges stemming from their operation of US Fidelis.