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IN THE UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF WEST VIRGINIA
In re
Panthera Enterprises, LLC,
Debtor.
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Bankruptcy Case No. 2:19-bk-00787
Chapter 11
WEST VIRGINIA ECONOMIC DEVELOPMENT AUTHORITY'S OBJECTION TO
DEBTOR'S THIRD MOTION FOR EXTENSION OF EXCLUSIVITY PERIOD
West Virginia Economic Development Authority ("WVEDA"), by its counsel, objects to
Panthera Enterprises, LLC's ("Debtor") Third Motion for Entry of Order Under 11 U.S.C. §
1121(d), Extending the Exclusivity Period for Filing and Confirming a Plan of Reorganization
and Disclosure Statement, filed May 11, 2020 (Doc 135) ("Third Motion to Extend
Exclusivity"), and as grounds for its Objection, WVEDA states as follows:
1.
WVEDA incorporates by reference as if fully stated herein, its Objection to
Debtor's Second Motion for Extension of Exclusivity Period, which was filed March 31, 2020
("Second Objection"). (Doc 111).
2.
On April 29, 2020, the Court heard the Debtor's Second Motion for Extension of
Exclusivity Period ("Debtor's Second Motion to Extend Exclusivity") and WVEDA's Second
Objection, which was overruled by Order entered May 12, 2020. (Doc 137) Debtor's exclusivity
period was extended to May 12, 2020.
3.
On May 11, 2020, Debtor filed its Third Motion to Extend Exclusivity. (Doc
135) Objections are due June 5, 2020.
4.
In its First Motion to Extend Exclusivity, the Debtor argued its "time and
resources [had been] occupied by disputes [with Panthera Training, LLC ("Panthera Training")
and WVEDA]," which were resolved or addressed with interim agreements, allowing the Debtor
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to focus on rehabilitation issues. (Doc 88) Nonetheless, the Debtor did not propose a plan of
reorganization and sought a second extension.
5.
In its Second Motion to Extend Exclusivity, the Debtor argued once again its time
and resources had been occupied by the adversary proceeding and now there was a second
adversary proceeding filed against the Debtor. Debtor suggested that resolution of the adversary
proceedings would allow the Debtor to focus on reorganization and proposing a plan of
reorganization. (Doc 100) But again, no plan of reorganization, nor even a possible proposal,
was proposed by the Debtor.
6.
Debtor's Third Motion to Extend Exclusivity omits the pending litigation
arguments as cause for another extension, but to the extent Debtor relies on such at hearing,
WVEDA incorporates by reference the arguments made and legal authority cited in its Objection
to the Debtor's Second Motion to Extend Exclusivity. (Doc 111) Specifically, pending litigation
is not, by itself, cause for extending the exclusivity period. Id.
7.
Debtor's Third Motion to Extend Exclusivity relies on the Covid-19 pandemic to
argue the Debtor should be granted an extended exclusivity period to August 12, 2020. The
Debtor claims that "the last two months have brought about unprecedented obstacles that are
entirely out of the Debtor's control," impeding the Debtor's efforts to make "substantive progress
toward developing future plans." (Doc 135, p. 4)
8.
What the Debtor glosses over is that it made no substantive progress toward
developing a plan of reorganization in the five or six months before the Covid-19 pandemic. The
Debtor filed its voluntary petition for bankruptcy protection on September 13, 2019. Its initial
exclusivity period expired on January 13, 2020 -- before Covid-19 was considered a pandemic in
this country. During this time, there was no progress made toward developing or proposing a
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plan of reorganization. Likewise, there was no progress made before the first extended deadline
of March 13, 2020, nor after that.
9.
On May 7, 2020, Panthera Training and WVEDA filed its Joint Motion to
Convert this Case to a Chapter 7 Proceeding for Cause Pursuant to 11 U.S.C. § 1112(b)(1)
("Joint Motion"). (Doc 132) Movants assert that cause exists based upon the Debtor's (a) gross
mismanagement of the bankruptcy estate; (b) failure to maintain appropriate insurance; and (c)
continuing loss and diminution of the estate and the absence of a reasonable likelihood of
rehabilitation. Id. All of these causes are likewise bases for not granting the Debtor's Third
Motion to Extend Exclusivity. WVEDA incorporates by reference the Joint Motion and the
arguments made therein in further support of its Objection to granting Debtor a third extension of
the exclusivity period.
10.
Moreover, the Debtor's assertion that it has not been able to "engage in
meaningful discussions with existing and potential business partners, contacts, resources and
plan advocates" because of the Covid-19 pandemic rings hollow. On April 15, 2020, The
Washington Post reported that the Federal Emergency Management Agency ("FEMA") had
awarded a $55 million contract for N95 masks to Panthera Worldwide LLC, the Debtor's
subsidiary. Another article was published by The Wall Street Journal on April 18, 2020,
according to which Panthera Worldwide LLC was to deliver 10 million masks by May 1, 2020.
Attached as Exhibit A to this Objection are copies of articles regarding the N95 mask contract
Panthera Worldwide LLC negotiated with FEMA.
9.
Panthera Worldwide LLC defaulted on the FEMA contract. According to an
article published by The Wall Street Journal on May 12, 2020, FEMA extended the May 1
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delivery date once to May 11, and when the masks were not delivered, the contract was
cancelled. See WSJ Article attached to this Objection as Exhibit B.
10.
The Covid-19 pandemic has not delayed progress on a plan of reorganization for
this Debtor. Rather, the Debtor's principal, Mr. James Punelli, who is also the principal of
Panthera Worldwide LLC (Doc 52-5, p. 29:4-6), has devoted his time and resources these past
months to working a $55 million contract with FEMA to the expense of the Debtor's
rehabilitation. Further, given that the Facility this Debtor purports to own relies heavily on
government contracts, default on a large government contract by the Debtor's subsidiary may be
more detrimental to the Debtor's prospects for reorganization than Covid-19.
11.
For all of the reasons cited herein, this Debtor does not have a realistic possibility
of rehabilitation, and the Debtor's creditors should not be held in abeyance any longer while the
Debtor's principal waits for some unknown infusion of capital. WVEDA requests this Court to
deny the Debtor's Third Motion to Extend Exclusivity.
WHEREFORE, for all of the reasons cited above, West Virginia Economic Development
Authority respectfully requests this Court to deny the Debtor's Third Motion to Extend
Exclusivity Period, and to grant such other and further relief as the Court deems appropriate.
Dated: June 5, 2020
WEST VIRGINIA ECONOMIC
DEVELOPMENT AUTHORITY
By Spilman Thomas & Battle, PLLC
s/ Debra Lee Allen
Debra Lee Allen, WVSB # 9838
48 Donley Street, Suite 800
Morgantown, WV 26507-0615
304.291.7920 | 304.216.5835
Email: dallen@spilmanlaw.com
Counsel for West Virginia
Economic Development Authority
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IN THE UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF WEST VIRGINIA
In re
Panthera Enterprises, LLC,
Debtor.
:
:
:
:
Bankruptcy Case No. 2:19-bk-00787
Chapter 11
CERTIFICATE OF SERVICE
I, Debra Lee Allen, hereby certify that on this 5th day of June, 2020, the foregoing West
Virginia Economic Development Authority's Objection to Debtor's Third Motion for Extension of
Exclusivity Period was served through the Court’s ECF system on all parties registered to receive
CM/ECF notices, including:
Mark Lindsey, Esq.
Bernstein Burkley, P.C.
707 Grant St., Suite 2200
Pittsburgh, PA 15219
Counsel for Defendant
Panthera Enterprises, LLC
Gary O. Kinder
U.S. Trustee's Office
300 Virginia Street East, Rm. 2025
Charleston, WV 25301
U.S. Trustee
/s/ Debra Lee Allen
Debra Lee Allen, WV Bar # 9838
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