New and fascinating filings in the SCO bankruptcy. What are these folks up to?
Take a look at the Berger Singerman's bill and see if you don't notice some odd entries. I'll tell you what I notice, and then you can do the same. Mesirow has filed another bill. They never get tired of doing that. But they get shorter and shorter. This bill is for $125,930.70, which represents a voluntary reduction. Hahahaha. 274.90 hours of financial counseling. What better for a company in bankruptcy? The bulk of the time was under the header "Liquidation Analysis". What is that? How to run through all your cash so Novell can't get any? (Joke. We saw one version of it already, in their withdrawn proposed reorganization plan involving Stephen Norris [PDF], p. 15.) Both of them have been busy as bees working on SCO's alleged new reorganization plan. It seems to be humming along, even if SCO isn't.
Here are the filings:
473 - Filed & Entered: 05/13/2008
Certificate of Service
Docket Text: Certificate of Service Sixth Monthly Fee Application Filed by Dorsey & Whitney LLP. (Schnabel, Eric)
474 - Filed & Entered: 05/13/2008
Application for Compensation
Docket Text: Quarterly Application for Compensation (Second) and Reimbursement of Expenses as Financial Advisors to the Debtors for the Period from January 1, 2008 through March 31, 2008 Filed by Mesirow Financial Consulting, LLC. Hearing scheduled for 6/17/2008 at 02:00 PM at US Bankruptcy Court, 824 Market St., 6th Fl., Courtroom #3, Wilmington, Delaware. Objections due by 6/2/2008. (Attachments: # (1) Notice # (2) Proposed Form of Order # (3) Certificate of Service and Service List - Fee Application # (4) Certificate of Service and Service List - Notice Only) (Werkheiser, Rachel)
475 - Filed & Entered: 05/16/2008
Application for Compensation
Docket Text: Monthly Application for Compensation (Eighth) for Services and Reimbursement of Expenses, as Co-Counsel to the Debtors in Possession for the Period from April 1, 2008 through April 30, 2008 Filed by Berger Singerman, P.A.. Objections due by 6/5/2008. (Attachments: # (1) Notice # (2) Exhibit A # (3) Certificate of Service and Service List) (O'Neill, James)
If you look at Berger Singerman's Exhibit A, what do you suppose the "warrant idea" might be? And why would Stephen Norris and Darl McBride be involved in a teleconference with the attorney about the new deal, if McBride is allegedly being thrown overboard, if the deal goes through? Here are the entries I notice in the section on Case Administration and Business Operations, beginning on page 5:
4/1/2008|| AJS|| Telephone Conference with D. Lampert Regarding Board Call and Call with D. McBride and S. Norris|| 0.20|
|4/1/2008||AJS||Telephone Conference with F. Caplan Regarding Warrant Idea and Call With S. Norris and D. McBride||0.20 ...
| 4/2/2008|| AJS|| Teleconference with D. Lampert Re Warrant Idea||0.30...|
|4/12/2008||AJS|| Exchange Email, Communications with D. McBride and D. Lampert Re Getting Deal Documented|| 0.20 ...|
| 4/29/2008|| DL|| Conference with Investment Banker, Follow up with Client, Etc. || 0.40|
Then on page 11, under the heading Claims Administration and Objection, we find something I wasn't expecting:
4/4/2008||AJS|| Telephone Call to H. Swaim, Esq., Counsel for Red Hat|| 0.10|
| 4/4/2008||AJS|| Telephone Call From and Telephone Call to J. Miller, Esq., Counsel for Red Hat|| 0.10|
|4/7/2008||AJS||Telephone Conference with H. Swaim, Esq., Counsel for Red Hat Regarding Proof of Claim and Post-Confirmation Trial Matters|| 0.20|
So Red Hat is in the room, y'all. And so is York:
| 4/7/2008|| AJS|| Exchange E-Mail Communications with S. McNutt Regarding Claim of York||0.10|
*Claim of York*??! What claim? Are they asserting a claim? Three days later, we see emails between Berger Singerman's Arthur Spector and Ryan Tibbitts at SCO regarding getting York its expenses reimbursed. And on the 10th, there is an office conference regarding "Trial of Motion to Pay York". So they know this isn't going to fly without a fight. The next day, you see "communications" with the US Trustee about "objection to same". There follow days of activity about it, and a notation regarding objections to "motion to pay York Administrative Expense". Then on the 21st, we see a conference with Ryan Tibbitts "regarding proofs of claim and proofs of interest".
And then on page 13, under the category of Tax Issues we see something truly fascinating:
4/14/2008|| NJ|| Review Tax Issues Regarding Proposed Changes to Restructuring; Review Revised MOU; Telephone Conference with Dan Lampert Regarding Option and Warrant Tax Issues; Various Conferences Regarding Same || 3.50|
4/14/2008|| SSP|| Review Revised MOU, Conferences with Nick Jovanovich and Dan Lampert Regarding Tax-Related Issues and Implications||3.50|
4/14/2008 ||NJReview Email From Grace Robson; Review Prior Emails; Conference with Grace Regarding Status of Net Operating Loss and Tax Gain Analysis to be Prepared by Accountants|| 0.30|
4/24/2008|| GR || Communications with K. Nielsen and N. Jovanovich Regarding Tax Implications of Plan||0.30|
That is on page 13. Weird. Do you suppose Stephen Norris is interested in SCO precisely because it is virtually certain to eternally have a net operating loss and hence a tax benefit? Or is it just a fringe benefit? I know it sounds crazy, but SCO... well... finish the sentence yourselves.
That still isn't the most fascinating entry. Here's the most intriguing, on the last page of Exhibit A:
|4/1/2008||AJS || Review Correspondence from T. Landau Regarding SUSE Arbitration|| 0.10 |
|4/15/2008|| AJS||Telephone Conference with S. Singer Regarding MOU||0.30|
| 4/23/2008||GR Communications with R. Tibbitts Regarding Objections to Subpoena for Utah State Court Litigation||0.20|
See what I mean? First, we learn the SUSE arbitration is alive, even if stayed by the bankruptcy court for now. Second, why is Stuart Singer of Boies Schiller involved in the MOU for the Stephen Norris deal? I gather there is one, at least in draft form. And what in the world is the "Utah state court litigation"? If any of you in Utah could check the court clerk and see if you can find out what's going on, that'd be great. Just look for the "usual suspects", as Judge Dale Kimball humorously calls them, and see if you find anything.
Berger Singerman is now due more than a half million, by the way. This bill is for $45,247.47, and the previous balance was $480,575.57, for a total of $525,823.04. The bill says they haven't been paid anything yet. $3,302.50 of this bill is for "tax issues relating to the changes to the new proposed structure for purchase of the company". They charge $28,886 for researching and conducting multiple conferences regarding "merger and acquisition issues and structuring plan alternatives." The firm says it worked on the Memorandum of Understanding, came up with various revisions, and helped SCO develop a business plan. Hmm. And that plan would be what? We are all ears.