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Dura Automotive case activity limited pending venue transfer decision
By Caroline Salls
Pittsburgh, Oct. 18 – Dura Automotive Systems, LLC has asked the U.S. Bankruptcy Court for the Middle District of Tennessee to only hold hearings on matters that “are just, proper, and necessary to avoid immediate and irreparable harm to the Dura debtors’ estates” pending a ruling on a motion to transfer venue of the Dura case to the U.S. Bankruptcy Court for the District of Delaware.
A status conference on the venue transfer motion is scheduled for Oct. 21.
On Thursday, the debtors in the Zohar III, Corp. bankruptcy case pending in the U.S. Bankruptcy Court for the District of Delaware asked the Middle Tennessee court to transfer Dura’s case to Delaware.
The Zohar debtors said they have substantial interests in the Dura debtors and hold $105 million principal amount of secured term loan debt in and have an indirect interest in the majority of the equity in the Dura debtors, “rendering them (among other bases) affiliates of the Zohar debtors.”
In addition, Zohar said the Delaware court approved a settlement agreement on May 21, 2018 under which the Zohar debtors, which are also affiliated with Dura chief executive officer and majority owner Lynn Tilton, agreed that Tilton and Zohar’s chief restructuring officer would conduct a monetization process to sell various portfolio companies in which Zohar has an interest. This includes the Dura debtors, according to the venue transfer motion.
Zohar said Tilton “orchestrated to put the Dura debtors, which Ms. Tilton has referred to as a ‘crown jewel’ portfolio company, into bankruptcy with the goal of providing DIP financing and an expedited 363 credit bid sale to herself.
Dura is an Auburn Hills, Mich.-based automotive parts maker. The company filed bankruptcy on Oct. 17 under Chapter 11 case number 19-06741.
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