Nauni Manty Successfully Operates and Sells Genisys Software, Inc as a Chapter 7 Trustee

Recently, Nauni Manty, a chapter 7 panel trustee for the District of Minnesota took control of operations for the business of Genisys Software, Inc. after the company filed a Chapter 7 bankruptcy case (Case no. BKY 14-40472). The debtor specialized in providing software and customer technical support for equipment rental, party rental, mountain sports rental and video rental. The debtor’s software packages handled not only the point of sale and rental aspects of businesses but also the service department, accounts receivable and purchase orders.

Although it is extremely uncommon for a chapter 7 trustee to operate the business of a chapter 7 debtor, Manty recognized that the sale of Genisys Software as an ongoing concern would realize a greater benefit than simply liquidating its personal property assets and collecting accounts receivable.  In a Chapter 7 liquidation, the business assets are liquidated and sold to the highest bidder.  However, Genisys Software had relatively little assets, which largely included software programs. Rather, the true value of Genisys Software was in its customer service contracts and its client base.

Because operating a business in a Chapter 7 is rare, the trustee , through her counsel, Manty & Associates, P.A., filed a motion with the bankruptcy court to obtain court permission to operate the business for a limited time and for the limited purpose of the sale.  The court granted the trustee’s request.  She operated the debtor’s business while soliciting potential bidders through a sealed bidding sale process that maximized the benefit for the estate and the creditors.  Manty’s strategic insight resulted in significant success for the bankruptcy estate and the creditors who will receive distributions from the April 22nd sale of the debtor to High Reach Company, LLC for $125,000. 

Mychal A. Bruggeman Joins Manty & Associates, P.A.

Manty & Associates, P.A. is pleased to announce the addition of Mychal A. Bruggeman to our growing Minneapolis office.  M&A has hired Mychal to focus on financial litigation, bankruptcy, creditors’ remedies, and banking.  Prior to M&A, Mychal was a shareholder in a larger Minneapolis commercial law firm. Mychal started his career as a trial attorney at the United States Department of Justice in 2005.  In these prior positions, Mychal received the benefit of “trial by fire” and arrives at M&A having already served as lead counsel in cases before the Eighth Circuit Court of Appeals, the Bankruptcy Appellate Panel, the Minnesota Court of Appeals, as well as federal, state, and bankruptcy courts in Minnesota and throughout the country.  With the experience of representing banks throughout his career and bolstered by his long-term involvement in the Risk Management Association, Mychal rounds out his practice by counseling financial institutions on a wide array of matters.  Mychal was named a Rising Star by the Super Lawyers publication in 2012 and 2013. 

Mychal sees M&A as a great platform for providing exceptional client services, and we are excited to make him part of the M&A legal team.  His contact information is 612-465-0347 and Mychal@mantylaw.com.  Feel free to contact him with any pending legal needs.   You can read more about Mychal here. 

Manty & Associates Wins Appeal in Tax Exemption Case

Manty & Associates recently won a case with the United States Bankruptcy Appellate Panel for the Eighth Circuit. The firm successfully appealed the bankruptcy court’s decision permitting a debtor to exempt a property tax exemption. See Nauni Jo Manty v. Grace Montgomery Johnson (No. 13-6050),http://media.ca8.uscourts.gov/opndir/14/04/136050P.pdf.

According to court documents, Trustee Nauni Manty objected to a debtor’s claimed exemption in a Minnesota state property tax refund. The debtor claimed the exemption as government assistance based on need. The United States Bankruptcy Court for the District of Minnesota agreed with the debtor and allowed the exemption.

A bankruptcy trustee has the fiduciary obligation to protect the interests of all beneficiaries of the estate and, as such, Trustee Manty appealed the decision claiming that the refund was not government assistance based on need. The Bankruptcy Appellate Panel for the Eighth Circuit reversed the bankruptcy court’s decision. In doing so, the B.A.P. explained that property tax refunds cannot be government assistance based on need because, among other reasons, they are available to individuals earning over $100,000.00.

Jackie Williams led the successful appeal, collaborating with several Manty & Associate attorneys.

Transaction of the Year Award Presented to Manty & Associates, P.A.

Manty & Associates, P.A. and Nauni Manty, as chapter 11 operating trustee, were recently recognized by the Upper Midwest Chapter of the Turnaround Management Association for their work in a transaction with Fifty Below Sales and Marketing.

The Upper Midwest Chapter of the Turnaround Management Association presented the award for its “2013 Transaction of the Year” to Chapter 11 operating trustee Nauni Manty, Jacqueline Williams, Nancy Jaeckels and Cassondra Williams, and the Eden Prairie-based Platinum Group at its monthly meeting on January 16th. The Chapter annually recognizes member firms and advisors for accomplishments that demonstrate exceptional achievement in the field of corporate renewal.

The 2013 award recognizes the Manty & Associates, P.A. team for their roles in the successful sale and transaction in bankruptcy in connection with Fifty Below Sales and Marketing, a Duluth based technology services firm.  Fifty Below’s assets were sold in two parts to ARI Network Services, Inc. and Emerald Connect by a motion for sale free and clear in the bankruptcy. The transaction was concluded in less than three months and saved almost 200 jobs in Duluth.

 In determining the winner of the “Transaction of the Year” award, the local awards committee considers a variety of criteria including: company circumstances leading up to the transaction; company market positions for its products or services; jobs saved; impact on unsecured creditors; economic impact on the local economy; comparison of company performance prior to and after the transaction; and valuation upon sale or liquidation of the company.

Nauni Manty attributes her success and that of Platinum Group to the dedication and loyalty of the Fifty Below Sales and Marketing employees and others she employed in the case to assist her with the sale of the company.

Dennis O'Brien Joins Manty & Associates, P.A.

Dennis O’Brien, a retired federal bankruptcy judge, is now of counsel with Manty & Associates. O’Brien was previously a federal bankruptcy judge for approximately 30 years for the District of Minnesota. He has extensive experience in all types of bankruptcy matters. He also mediated a number of disputes as a bankruptcy judge and is continuing with mediation in his practice at Manty & Associates.

O'Brien carries with him a wealth of knowledge and experience to resolve these disputes efficiently. O'Brien will add to Manty & Associates' experienced, professional team of business, banking and commercial lawyers, who provide proficient legal services meeting the individual needs of each client.

You can learn more about O'Brien here.