Franchise Services shareholder Boketo’s case dismissal motion granted

By Caroline Salls

Pittsburgh, Dec. 18 – Franchise Services of North America, Inc.’s Chapter 11 bankruptcy case was dismissed Monday by the U.S. Bankruptcy Court for the Southern District of Mississippi.

As previously reported, creditors Macquarie Capital (USA) Inc., Michael John Silverton and Daniel Raymond Boland asked the court to dismiss the case.

However, judge Edward Ellington said in Monday’s order that the Macquarie parties’ motion “is not well-taken and not granted.”

Instead, the judge said the case was dismissed because of Macquarie affiliate Boketo LLC’s joinder of the dismissal motion. Specifically, Ellington said Boketo manager Tobias Bachteler testified that Boketo never authorized or consented to Franchise Services’ bankruptcy filing.

The Macquarie parties said in their motion, which was fully adopted in Boketo’s joinder, that the case should be dismissed because it “was filed without proper corporate authority.”

The creditors said Franchise Services’ certificate of incorporation prohibits it from filing a bankruptcy petition unless the holders of a majority of the outstanding shares of its series A preferred stock consent to the filing.

According to the motion, Boketo owns 100% of the outstanding shares of Franchise Services’ preferred stock.

Ridgeland, Miss.-based Franchise Services is the holding company for operating entities that own several car rental brands whose associated independent operators have locations across the United States. The company filed bankruptcy on June 26 under Chapter 11 case number 17-02316.

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