Posted on 11/16/2004 4:37:44 PM PST by Born Conservative
CHESTERFIELD, Mich., Nov. 15 /PRNewswire/ -- Lionel LLC, the nation's number one model train manufacturer, today announced that it has filed a voluntary petition in the Bankruptcy Court of the Southern district of New York for protection under Chapter 11 of the U.S. Bankruptcy Code (1). The filing was prompted by a $40.8 million judgment against the company for the alleged misappropriation of a competitor's toy train designs by a subcontractor. Lionel's day-to-day operations will continue as usual, including meeting all merchandise shipping obligations customary for the holiday selling period and rolling out new products on schedule. The company remains dedicated to creating and manufacturing the quality product for which it has long been known.
Jerry Calabrese, the recently named CEO of Lionel, said, "The MTH judgment alone has forced us to take this action. Lionel is a sound company that enjoys healthy sales, growing demand for our products and the best brand and reputation in the business. Having said that, the size and weight of this judgment is just too much for what is essentially a small business to bear. Taking advantage of bankruptcy protection will not only allow us to pursue an eventual reversal of this unfair decision, it will enable us to create, manufacture and ship our products in our normal and usual way."
About Lionel LLC
Lionel LLC is one of the world's leading marketers of model trains and accessories. Established in 1900, the Lionel name is the most widely recognized brand in the toy train industry and one of the most recognized brands in America. Lionel has been at the center of every major innovation in toy train manufacturing and marketing since its inception.
(1) Chapter 11 of the U.S. Bankruptcy Code allows a company to continue to operate its business and manage its assets in the ordinary course of business. Congress enacted Chapter 11 to enable a debtor to preserve its going concern value and operations, as well as to provide its employees with jobs and to satisfy creditor claims based upon the value of the reorganized company.
I do believe that Lionel was bought by Neil Young some years ago. He has a son with Autism that is facinated by trains.
You're right. I think that in addition to the lawsuit, MTH has been kicking their butt; nicer looking trains, and the track was much easier to set up.
Funny, I thought Neil Young abandoned his wife Carrie Snodgrass and his autistic son. Snodgrass sued him for lack of child support. She gave up her acting career to raise the boy by herself. Who knows though.....
"...alleged misappropriation of a competitor's toy train designs by a subcontractor"
By a subcontracter? And Lionel has to pay? Talk about more scumbag lawyer and activist judge misapplication of the law and common sense.
Let's trash and bankrupt a company and fire everybody so they can all go on welfare just so a lawyer can be more of a millionaire without ever doing an HONEST days labor.
American Flyer?
Now there's a train?
At the risk of making fun of mental handicaps, I always thought Neil Young was the one with autism.
Very possible. Frankly, I don't keep up much on the personal lives of celebs. I'm an admitted pop culture illiterate. I'm pretty sure though that Young still has part ownership of the company.
If it was done on Lionel's dime, yes, it does.
Filing a Chapter 11 simply to protect your otherwise solvent company from having to file an appeal bond while pursuing an appeal from an adverse judgment will very likely be held to constitute an abuse of the bankruptcy system, which would result in the dismissal of Lionel's Chapter 11 filing and the assessment of terms against Lionel and its attorneys. Publicly admitting that that is exactly what you are doing is incredibly stupid.
I sure would like to be representing MTH right now.
BTTT
LVM
So, if I hire a gardner, and he goes down the street and steals someones property -- *I* and responsible for the theft?
Really stupid in my opinion -- only logical in the deviant minds of scumbag lawyers
Apparently it wasn't a calculated risk.
*I* and = *I* am
(just in case someone can't figure that one out - like lawyers)
I think you are reading it wrong, it is just bad English. The subcontractor's (MTH) designs were allegedly stolen by Lionel, MTH sued, and the court agreed. Lionel had been knocked for several years for their lack of innovation. They apparently tried to get over that by stealing designs and IP from MTH. What would you have done if you were on MTH's shoes?
Check: http://www.trains.com/Content/Dynamic/Articles/000/000/005/517vkoih.asp
Now THAT would change the meaning of that sentence entirely.
The sentence read that a subcontractor stole designs FROM MTH.
Damn! And I had such a fine rant going!
LVM
But they don't de-rail so easy.
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