A judge reclassified the bankruptcy status of Premier Properties USA today,
clearing the way for a U.S. trustee to take hold of the company and begin selling its assets.
U.S. Bankruptcy Court Judge Basil H. Lorch III approved a motion to convert the bankrupcty case to Chapter 7 from Chapter 11, ending Premier founder Christopher P. White's hopes of resurrecting the Indianapolis development firm.
White had been trying to raise money to save the 15-year-old company, which developed numerous high profile retail projects, including the Metropolis mall in Plainfield.
Premier sought bankruptcy protection April 23, listing debts of more than $2.8 million to 20 creditors - not including millions of dollars in unpaid bills related to specific properties. White and his company also face a slew of lawsuits, alleging unpaid bills, defaulted loans and check fraud.
Today's decision means a trustee now will take control of the company to liquidate any of Premier's remaining assets.
That probably isn't much, said Henry Efroymson, an Ice Miller attorney who represents Atlanta-based Dominion Capital Management LLC, a Premier creditor that took control of most of its properties last month.
"If there's going to be a distribution to creditors, it's going to be very small," Efroymson said. "There isn't much left ... this was a management company."
During the hearing, Efroymson also asked that Dominion Capital be given full access to Premier's records. He said his client had received the "lion's share" of records on Premier's properties, but needed to review the company's computer hard drives to retrieve the rest of the data.
Some of those hard drives have been moved to White's home, said William J. Tucker, Premier's bankruptcy attorney. But Tucker said a backup of the files has been made and he said that Premier has not hidden or removed anything.
Still, Efroymson said he was concerned, since the trustee won't take control of the files until Monday.
"The concern now is there is nobody in place ensuring the data remains on the computers and servers," he said.
The decision today also won't provide much relief to Premier's former employees, many of whom have not been paid for at least eight weeks.
"I don't see that there's going to be any funds for former employees," Efroymson said.