$1.35m paid to Foss lawyers, consultants
The U.S. Bankruptcy Court has awarded lawyers and other consultants involved in Foss Manufacturing’s Chapter 11 bankruptcy case interim fees and expenses totaling more than $1 million.
In total, the court awarded the lawyers and consultants $1.35 million. The largest amount, $406,000, went to Harold B. Murphy, a Boston attorney representing Patrick J. O’Malley, the trustee running the company, who himself received $366,000.
The Hampton-based industrial felt producer — which sold virtually all of its assets for $39 million to a group of Florida investors earlier this month — will continue operations and pay off its secured creditors. But it has left behind virtually nothing to unsecured creditors, leaving the door open to litigation against former company officials, in particular former CEO Stephen Foss.
Lawyers representing the creditors would get most of their reimbursement on what they collect.
The firm of Bernstein, Shur, Sawyer & Nelson received no compensation, and McLane, Graf, Raulerson & Middleton, which is representing the creditors, received a $49,000 payout.
Also on Tuesday, O’Malley asked the court to allow the firm’s name to be changed to Felt Manufacturing, with the aim of “winding down” the bankrupt corporate shell, now that most of the assets are gone. The ongoing facility, however, would continue to operate under the Foss name. – BOB SANDERS