by Kyle Mooty
Posted 7/10/2000 12:00 am
Updated 2 years ago
Several law firms have been hired in an attempt to retrieve money Charger Inc. paid out for services rendered within 90 days of the former Springdale-based company's Chapter 7 bankruptcy filing on Dec. 28, 1999.
Numerous business, including several in northwest Arkansas, are being affected by the federal law which allows the recouping of this money. Northwest Arkansas Business Journal received copies of some of the notification letters from several angry businessmen in the area.
John T. Lee, an attorney from Siloam Springs, is the trustee for the lawsuit. He said that every case involving Charger payouts in that 90-day window would be reviewed individually. He estimated the total of retrievable money to be about $5 million. "Maybe more," he added.
All of the businesses are currently being notified. The law firms helping with the case include Cypert Crouch Clark & Harwell of Springdale, Wright Lindsey & Jennings LLP of Little Rock, Balch & Bingham of Birmingham, Ala., and William Mullen Clark & Dobbins of Virginia Beach, Va.
Lee said that each business receiving the letter will "not necessarily" be forced to return the money.
"Under some circumstances, payments are set aside and voided, canceled," Lee said. "Others may have been a preferential transfer where they were paid over other creditors. We're trying to pull out those transfers that may have a valid defense to where several defenses may be raised."
As the trustee in the case, Lee will make those decisions. He said hundreds of accounts would be reviewed.
Lee refused to say which were the biggest accounts. But he did add, "There are some very, very substantial amounts of money."
There is also the question of paychecks Charger handed out that bounced in December. One employee's wife said the bounced paycheck caused several other checks to bounce, spoiling Christmas for their children and grandchildren. As of last week, she and her husband had yet to hear if they would get that money through the bankruptcy.
— Kyle Mooty