PORT TOWNSEND – A hearing that could have informed more than 65 unsecured creditors how much Port Townsend Paper Corp. will pay them was rescheduled again.
The hearing was to have been on Tuesday, after it had been postponed from an original March 14 date.
It has been rescheduled to June 12 after a motion for a continuance filed by Port Townsend Paper was granted.
“They haven’t finalized their disclosure statement,” said Mark Northrup of Seattle’s Graham & Dunn, who is the attorney for the unsecured creditors committee, on Thursday.
“This is the same problem we’ve had for months in this case.”
Port Townsend Paper Corp. filed for Chapter 11 bankruptcy protection on Jan. 29 for the Port Townsend kraft-paper producing mill.
The mill employs about 310 people and is the largest private employer in Jefferson County.
Comment was unavailable Thursday from Port Townsend Paper President John Begley.
But when the hearing was postponed in March, Timothy Leybold, chief financial officer for Port Townsend Paper, said the new hearing date would give the company more time to file its disclosure statement.
He said the court appointed the firm of Alvarez and Marsal as Port Townsend Paper’s restructuring officer.
The hearing will be in U.S. Bankruptcy Court, Western District of Washington, in Seattle.
Unsecured creditors filing claims with the bankruptcy court include more than 65 individuals, businesses, government agencies and nonprofit organizations in Port Angeles, Port Townsend, Port Hadlock, Quilcene, Sequim, Carlsborg, Forks and Neah Bay.
“Secured creditors” are those funding the company: the CIT Group, primary lenders and a group of bondholders.
“Unsecured creditors” are everyone else.
If enough of the company’s assets are left over after the secured creditors are paid, then unsecured creditors will be paid based upon the proportion of the claim relative to the total unsecured claims.
The June 12 hearing could result in a ruling by Judge Samuel J. Steiner on the Port Townsend Paper bankruptcy protection disclosure statement.
Northrup said he wasn’t sure what the protection disclosure statement would mean for the unsecured creditors because he hasn’t seen the statement yet.
“We are all just literally waiting on this statement.”
