The demise of few companies has so accurately depicted the changing environment caused by the rise of computers, the internet and smartphones as the bankruptcy of the Eastman-Kodak Company (“Kodak”). As a worldwide leader in photography for several decades and employer of hundreds of thousands of employees, Kodak was an icon all over the globe. The notion that the company would cease to exist just ten years prior to its bankruptcy would have appeared quite fanciful at the time.
But file bankruptcy it did. The Rochester, New York-based company filed for Chapter 11 bankruptcy in January 2012 after spending $3.4 billion on earlier attempts to turn its business around and after it had shed 47,000 employees since 2003, closed 13 factories that made film, paper and chemicals, and shut 130 photo laboratories. Kodak obtained court approval of an exit plan in August 2013 and emerged from bankruptcy in September as a commercial-printing business.
But its emergence from bankruptcy did not mean that recovery of assets from the period prior to its filing would cease. The bankruptcy court established a trust for the purpose of liquidating assets. The Court gave the trustee the authority to sue on behalf of the trust. Under this authority, the trust has now sued Altek Corporation in order to recover payments of about $49.2 million that were made to that digital photography company within the 90 days prior to the filing of Kodak’s bankruptcy. This suit, Kodak GUC Trust v. Altek Corp., 14-02032, U.S. Bankruptcy Court, Southern District of New York (Manhattan), constitutes an attempt by the trustee to exercise its “clawback” authority which provides trustees the opportunity in the bankruptcy setting to recover payments to creditors which may have been made as a preferential or fraudulent transfer in anticipation of the bankruptcy itself.
In Albuquerque, Giddens & Gatton Law, PC has attorneys who offer expert handling of Chapter 7, Chapter 11, Chapter 12 and Chapter 13 bankruptcy cases. The firm represents many debtors and creditors in Albuquerque, Santa Fe, Taos, Raton, Farmington, Gallup, Grants, Roswell, Los Lunas, Placitas, Belen and the rest of New Mexico. Contact Giddens & Gatton Law, PC at (505) 633-6298 to set up an appointment or visit the firm’s website at giddenslaw.com. Giddens & Gatton Law, PC is located at 10400 Academy Road N.E., Suite 350 in Albuquerque, New Mexico.