Archive for June, 2010

Loan Guarantees Led To Brunell’s Bankruptcy – Bankruptcy Beat – WSJ

Personal guarantees of numerous business loans contributed to National Football League quarterback Mark Brunell’s Chapter 11 filing.

The former Jacksonville Jaguars star filed for bankruptcy protection in the city where he played for nine seasons on Friday. In court papers, he listed $5.5 million in assets and debts of $24.7 million.

Among Brunell’s largest debts is a more than $5 million guarantee of a loan to JWB Owner LLC and more than $4 million in personal loan guarantees to his defunct Champion LLC business. Both companies were involved in real-estate investments.

Brunell and his wife also owe nearly $2.9 million on their home in Ponte Vedra Beach, Fla.

While Brunell earned more than $50 million in his NFL career, including $1.6 million for throwing 30 passes for the New Orleans Saints last year, a string of failed real-estate investments caused the three-time Pro Bowler’s financial woes.

Brunell filed for Chapter 11 protection, meaning he intends to craft a plan to repay his creditors. It’s not clear if he intends to sell off any of his assets as part of that plan, but he did list some of his most valuable possessions in court papers.

Among those were his Super Bowl ring won in February, rings from his three appearances in the Rose Bowl as a member of the Washington Huskies and his National Championship ring.

Brunell also listed a small collection of guns, including a 12-gauge Remington shotgun and a Winchester 45, and three vehicles, the most valuable of which is a 2008 Ford F-250 pickup truck.

Brunell and his wife each listed a $5,000 monthly salary from Mark Brunell Enterprises Inc. as their primary source of income. The company operates youth football camps. Brunell, 39, is not currently on an NFL roster.

Among the quarterback’s monthly expenses are a $5,627 monthly mortgage payment, $1,292 in food expenses for his family of six and a tithe to his church that “will vary as it is 10% of gross income.”

From AL.com:

WASHINGTON — The Internal Revenue Service says oil spill victims who receive BP payments for lost wages will have to pay up come tax time.

Under current law, BP payments for lost wages are taxable — just like the wages would have been, the IRS said in tax guidance issued Friday. Payments for physical injuries or property loss, however, are generally tax free. Payments for emotional distress? Taxable, though medical expenses related to the emotional distress are deductible.

BP officials have agreed to create a $20 billion fund for spill victims, as well as a $100 million fund to support displaced oil rig workers.

The IRS issued the guidance today to help spill victims sort through the law’s complexities. The agency has posted tax information for oil spill victims on its website and plans to hold forums in seven Gulf Coast cities on July 17 to help victims with tax troubles or questions.

Bidders Snap Up Polaroid Images – Bankruptcy Beat – WSJ

Bidders turned out in full force for this week’s auction of Polaroid images, shelling out millions of dollars to snap up the 1,000-plus photos and setting new records in the process.

The two-day auction, held in connection with Polaroid Corp.’s bankruptcy proceedings, raked in $12.4 million, about $2 million more than was expected, according to the Associated Press.

That includes the record-setting sale of Ansel Adams’s mural-sized print of Yellowstone National Park for $722,500, surpassing a previous auction record of $609,600 set in 2006. Adams’s print, depicting the park’s rugged terrain in winter, was expected to sell for no more than $500,000.

Another bidder broke the record for an Andy Warhol photograph, “Self-Portrait (Eyes Closed),” which sold for $254,500.

All in all, 14 new artist records were set at the auction, including records for Robert Rauschenberg, Harry Callahan, Lucas Samaras, Chuck Close and David Hockney.

The sale of the images, handpicked from Polaroid’s collection of 16,000 photographs, will go toward paying off creditors of the company’s bankruptcy estate.

Now known as PBE Corp., the company sold the Polaroid name and other assets out of bankruptcy last year to a joint venture of Hilco Consumer Capital Corp. and Gordon Brothers Brands LLC.

The Chattanooga Times-Free Press reported that an area man who ran two red lights while trying to drive his wife to the emergency room while she suffered from stroke like symptoms now faces multiple charges, while the arresting  officer who chased them is on paid leave.  Both the man and his wife are EMT’s, and he decided to forgo the ambulance service.  Now he faces charges of felony evading arrest, assault on police, disorderly conduct, reckless endangerment, registration expired and two counts of traffic signals violation.  The police spokesperson argues that regardless of the emergency, citizens have a legal obligation to pull over for officers.  At the same time, law enforcement and governmental agencies can be held liable where their actions arise to wrongful conduct.

If you or a loved one have been injured in an accident or hurt on the job, call the personal injury attorneys at The McKellar Law Firm for your FREE Consultation today, at (865) 566-0125.

The Bristol Herald Courier reports that those tiny roses sold inside glass tubes at gas stations are in fact being used by people who smoke drugs, like crack and meth.  Yes, nothing says “I love you” like buying your sweetheart a rose and some drug paraphernalia in one stop.  For now, the local police are not moving in to bust this syndicate of sin, but they are aware the potential for harm.  According to the federal Drug Enforcement Administration, drug paraphernalia is a multibillion-dollar industry, with most profits being made in the United States. In 2004, the agency busted a Detroit paraphernalia ring with 334,000 Love Roses, worth $1.3 million.

If you or your business face criminal charges, call the defense attorneys at The McKellar Law Firm today for your FREE Consultation, at (865) 566-0125.

Bankruptcy Stinks – Bankruptcy Beat – WSJ

By Kristina Doss

Clint Jolly’s food store in Sparks, Nev., may have sought bankruptcy protection in 2008 and eventually closed. But he still felt compelled to issue an apology recently to local residents that have had to put up with a “pretty funky” smell oozing out of a freezer full of rotting meat located right outside the store.

Jolly posted a statement and YouTube video on his website Monday, explaining that the freezer was used to store game meats that his store – known as Butcher Boy – would process for hunters. But since handing the reigns of the store to a bankruptcy official, the power has been shut off to the outside freezer and the meat stored in there has since spoiled “to the point that the Environmental Health Services Department is talking about having a HazMat team come in and clean it up.”

As local residents struggle to deal with the situation, Jolly offered in his YouTube video “big apologies to people whose animals got destroyed that way, and big apologies to anyone who is living in that trailer park behind the shop.”

Butcher Boy, which was also operated by Jolly’s father, provided groceries and deli and catering services to the Sparks community. Since its founding in 1974, the store became a popular place for local families in search of fine foods such as prime rib and ham.

But by 2008, a new store Jolly and his father opened in Reno struggled to reach sales goals and brought on a set of managerial challenges Jolly and his father weren’t prepared to face.

Butcher Boy filed for Chapter 11 protection on July 25, 2008, hoping to reorganize its debts and “keep the business moving forward,” according to court documents. But after the company’s financial situation failed to improve, the court last year dismissed the bankruptcy case.

Jolly said that their “only choice was to turn over everything we owned to the bank” and the trustee in the Chapter 11 case. The locks to the property were changed, and Jolly and his father haven’t had any access for the past five to six months, Jolly said.

They did their best to explain to the trustee what they thought needed to be done. “Of course, they don’t have to listen to us and apparently they didn’t,” Jolly said.

A local television station recently showed maggots swarming around the outside freezer and interviewed residents living nearby complaining of the smell.

In his YouTube video, Jolly apologized for the mess.

“Apparently, they let the power get shut off and it’s all spoiled,” Jolly said. “So huge apologies from me and my dad, Ken. (It’s) not the way we wanted it to end up.”

Jolly said he wishes there was something they could do, because the “smell of it is pretty funky and hopefully it gets cleaned up quick.” But with no access to the property or bank accounts to pay the power bill, “I’m kind of powerless,” he said.

Along with the $20 billion BP plans to set aside in response to civil claims, The New York Times reports that criminal charges are on the horizon.  Some analyst’s predict that such a scenario could make BP’s costs balloon to nearly $70 billion.  The ripple effects could spread to being blacklisted from future sales contracts with the government under procedures officially known as suspension and debarment.

If you or a loved face criminal charges, you need to know your rights.  Call the criminal defense attorneys at The McKellar Law Firm, for your FREE Consultation, at (865) 566-0125.

Being audited, especially via an in-person audit, can be a scary proposition.  Even worse, it could result in the IRS building a criminal a criminal case against you.  Forbes magazine has some good advice on what to do in the event you are audited, including:

When The Tax Man Cometh (In Person) – Forbes.com

A taxpayer should always be represented by an attorney if the case involves potential criminal offense, such as tax evasion, filing a willfully false tax return, or failure to file a tax return that is due. Often, if amended returns need to be filed in such a case, the attorney will hire a CPA to do this work.

If you need representation during or prior to an IRS audit, please contact Norman D. McKellar today at 865-566-0125.

Over 200 lawsuits have already been filed as a result of BP’s oil spill, and that figure could climb into the thousands.  In response to this, consolidation of the federal suits is almost certain, so that one or several judges can begin processing the claims.  The New York Times reported today about the ongoing jostling between two key groups of plaintiff’s attorneys, mass tort and specialists.  Mass tort lawyer specialize in consolidation and multi-district litigation, while the specialists are Gulf area practitioners who have been battling oil and gas companies for years.  Regardless, this is sure to be one the largest, most complex legal cases in American history.

If you or a loved on have been injured in an accident or hurt on the job, you may be entitled to compensation and need to know your rights.  Call the personal injury attorneys at The McKellar Law Firm today for your FREE Consultation, at (865) 566-0125.

Old Time Pottery bankruptcy moves to reorganization plan » Knoxville News Sentinel

Old Time Pottery, which has been based in Murfreesboro since 1985, announced Wednesday that it has received approval for its reorganization plan from Chapter 11 bankruptcy in federal court.

Under the agreement, approved May 28, Old Time Pottery will exit bankruptcy with 30 store locations, down from 37 stores prior to the filing in August 2009. The Murfreesboro store was not a part of the reorganization and will remain open.

The Murfreesboro store on River Rock Boulevard, the first store in the chain which opened in 1986, was not affected by the reorganization. Neither were stores in Madison and Memphis.

Six of seven under-performing stores have already closed and the seventh is in the process of being closed. Scott Peterson, president and chief executive officer of Old Time Pottery, said it will be closed by the end of the month.

Read the full story at the Daily News Journal.