Archive for September, 2009

Written by Craig D. Robins, Esq.

KRN Holding, LLC  filed for Chapter 11 bankruptcy relief on August 5, 2009 in the Central Islip Bankruptcy Court under case number 8-09-75889. Judge Alan S. Trust is the assigned bankruptcy judge.

The company, which is located in Brooklyn, is being represented by Queens bankruptcy attorney Nigel E. Blackman of Blackman & Melville, PC, located in Jamaica. The debtor is, or was, the owner of a commercial building in Brooklyn. The major tenant is a funeral home.

The company has elected to be treated as a small business Chapter 11 debtor.

The Meeting of creditors will be held on September 11, 2009 at the United States Bankruptcy Court for the Eastern District of New York in Central Islip (Room 562 at 10:00 a.m.). An emergency hearing was already held before Judge Trust on August 27, 2009 which will be continued on September 24, 2009 (Courtroom 960, 2:00 p.m.).

 This post is one of a series of posts available on the Long Island Bankruptcy Blog detailing every Chapter 11 bankruptcy case filed in the Central Islip Bankruptcy Court since August 1, 2009.  I will typically post a summary of each Chapter 11 case several days or weeks after it is filed as not all info is available immediately upon filing.  To see a list of Chapter 11 cases profiled on this blog, click Chapter 11 Filings on Long Island or type the name of the debtor in the upper right search box.

Written by Craig D. Robins, Esq.

Sometimes even municipal entities need to obtain bankruptcy relief.  New York Governor David Paterson signed an executive order yesterday that will enable New York City Off-Track Betting Corp to file for bankruptcy as a municipality.

OTB will be filing for Chapter 9 relief.  This is the chapter of the bankruptcy code that applies to municipalities and enables them to restructure and reorganize their debts through a bankruptcy proceeding.

Chapter 9 can be contrasted with Chapter 7, which is the type of bankruptcy consumers usually file to eliminate credit card debt, and Chapter 13, which is the other type of consumer bankruptcy, which lets consumers save their homes with a bankruptcy payment plan.  There is also Chapter 11, which is a plan of reorganization usually used by businesses.

The OTB was set up as a public benefit corporation in 1970 to raise money from pari-mutuel betting for New York City, the state and the horse-racing industry. In pari-mutuel betting, all bets of a specific type are pooled with the house subtracting its “take” before paying the winners.

However, despite taking more than $1 billion in bets every year, the OTB has not been able to cover its operating costs for quite some time and has accrued liabilities of $220 million.

Under Chapter 9, OTB will overhaul its business model, renegotiate with its unions, upgrade its technology and end some of its leases.