The collapse of Pace Airlines Inc. may have happened in less than four months in 2009. But for former employees, the handling of the criminal and legal follow-up has taken on a maddeningly methodical pace over the past two years.
William Rodgers Sr., co-owner of the defunct company, appears no closer to going to trial over his one felony criminal count than he did when he was arrested by state insurance officers on Sept. 22, 2009 — just five days after Pace was shut down for good.
Rodgers took over Pace based on a promissory note to pay $9 million to the estate for stock in Pace Airlines LLC and Pace Airlines II LLC and take over $6 million in liabilities. The company was forced into Chapter 7 bankruptcy by creditors in January 2010.
Rodgers faces one count of willful failure to pay group health-insurance premiums — a Class H felony. He has been out of jail on a $50,000 secured bond.
After the Forsyth County District Attorney's Office took over the case in September 2009, a preliminary hearing in District Court was continued five times before the case was assigned to the N.C. Attorney General's Office in September 2010. The hearing has been continued at least once since.
Noelle Talley, a spokeswoman for the attorney general's office, said last week that she had no update on its investigation.
"It's a complicated case, and attorneys with our office are continuing to work on it," Talley said. "The attorney who was originally handling it for our office retired, and the case has been reassigned."
In August 2010, the N.C. Labor Department filed a claim for $1.5 million in back wages for 423 employees with the Chapter 7 bankruptcy trustee. The department is also requesting interest on the back wages.
Dolores Quesenberry, a Labor Department spokeswoman, also said last week that she had no update on its claim.
Edwin Allman III, the bankruptcy trustee, has said the employees' claims are ranked highest in terms of priorities after the lawyers are paid.
Allman has been successful in adding to the Pace estate's assets. Counting the $9,500 gained from the sale of two pieces of company property last week, there is about $403,000 in the estate.
Allman requested last week that the bankruptcy court judge approve a $32,000 offer from a buyer wanting some of the defunct company's tooling equipment. A hearing has been set for 2 p.m. Oct. 12 in the U.S. Bankruptcy Court in Winston-Salem that could draw other bidders.
The bulk of the potential recovery for the employees could come from two legal proceedings Allman is pursuing.
He has received permission to pursue $1.46 million from a South Carolina tourism company based on a breach-of-contract lawsuit filed by Pace shortly before its collapse. The lawsuit involves a dispute with Southern Sky Air & Tours LLC, doing business as Direct Air.
In July, Allman filed a request that the estate of Bob Brooks return $800,000 to the defunct company that Rodgers used toward his purchase obligation. Allman said there has not been a response from the estate.
Brooks was the founder and chairman of Hooters of America Inc. when he bought Pace in 2002 to convert its charter-airline service to Hooters Air. However, his idea for taking the hotties-in-tight-shirts concept into commercial-passenger service failed quickly.
After Brooks' death in July 2006, the estate controlled Pace until Rodgers took over. Allman said Pace was nearly insolvent at the time of Rodgers' acquisition. He said Pace was not obligated to make the purchase payments for Rodgers to the estate.
Attorney fees are likely to eat into any money that comes from the lawsuit or the legal action with the Brooks estate.
Allman said a final report will be filed that will set all receipts and disbursements and proposed distributions. "This will not occur until all assets have been reduced to cash or abandoned," he said. His projected timetable for completing that task has been the end of 2013.
Former employee Wayne Gunter of Lewisville, who is owed $5,000, said he's "just about given up hope that anything will come of it, charges against Rodgers and any recovered money."
"You really haven't seen the legal system put much emphasis on our case. It's almost like they are willing to just let it go as much as they seem to be investigating it."
No comments:
Post a Comment