Produce companies owed money by the defunct Hunts Point Tropicals still have a good chance of recovering their claims despite a legal snafu related to the sale of the former company’s units at the terminal market in the Bronx.
More than 40 companies have filed claims against Hunts Point Tropicals totaling more than $1.2 million under the Perishable Agriulture Commodities Act. The company filed Chapter 11 bankruptcy in May 2011.
The federal bankruptcy judge on the case ordered the sale of the units at New York City’s famed Hunts Point terminal market, designating the proceeds to be used to pay creditors of Hunts Point Tropicals produce company.
However, the sale hit a snag when the market board rejected a $1 million bid from C and J Bros. Inc, three times. The board finally opted for a $750,000 bid from A&J Produce Corp., which is a major player on the terminal and holds a seat on the board.
When the sale was challenged during the bankruptcy proceeding, the judge said the issue wasn’t under her jurisdiction and would have to be decided by a state court.
A state judge set a hearing on the matter for April 16, but instead of filing a brief in the case the attorneys for the terminal filed a motion for dismissal, effectively stalling the proceeding.
Paul Gentile, an attorney representing some of the creditors who filed claims against Hunts Point Tropicals under PACA, is representing C and J Bros.
Gentile said he had 30 days to file a response to the motion for dismissal, but he only took three days because he wants to get the case rolling. The bankruptcy judge has said she will move forward regardless of the status of the case in state court.
“On Monday (April 16) the judge set oral arguments on the dismissal motion for April 23,” Gentile said April 19. “So the case is on a fast track.
“There’s still enough time to get this wrapped up before the bankruptcy (case closes). I’m satisfied the (state) court is moving as fast as possible.”
Officials with the terminal board have declined to comment on the sale of the market units, citing the pending litigation.