Interex hopes to keep some assets
September 26, 2005
Lawyers for the defunct HP user group Interex have filed a motion to keep books, records and physical assets of the organization, despite the fact that the group went bust owing more than $4 million. The motion asks that the court permit the user group to "abandon" office equipment, computer systems and more, much of which was carefully itemized including depreciation records in the Interex Aug. 11 bankruptcy filing.
Carol Wu, the court-appointed trustee for the bankruptcy, explained that when a bankrupt company files for abandonment, it seeks to regain possession of the assets in question. "When the assets are abandoned they revert back to the debtor," she said in an e-mail. "It’s up to the debtor at this point on what will be done with them."
Interex's lawyers contend that selling off the equipment and assets would decrease the value of the organization's holdings, because the cost of the inventory and auction would exceed what Interex might get from selling off things like HP-UX and HP 3000 servers, more than a dozen laptops and an array of desktop computer networks and switches. HP 3000 customers and former user group members are wondering if the abandonment includes the group's mailing lists, an asset whose value was listed as "unknown" in the Federal filing. The list of abandoned materials does include "books and records." The deadline for filing an objection is the end of this week.
Terry Simpkins, a director of the CAMUS manufacting user group and frequent reporter on SOX issues for the ERP 3000 user, asked if any of the Interex assets might help along the OpenMPE homesteading efforts. "Did anyone object?" he said in a message on the 3000 mailing list. "Is anyone going to be able to rescue the mailing list, membership list? Is OpenMPE going to be able to 'adopt' any computing equipment that it may have a use for?"
The motion can get a hearing before judge Marilyn Morgan in the US Bankruptcy Court in San Jose, but only if the court receives an objection. The notice of the abandonment arrived 10 days ago in mailboxes of all creditors, both secured and unsecured:
Notice is hereby given that Carol W. Wu (“Trustee”), trustee of the above referenced bankruptcy estate, intends to abandon the Debtor’s remaining books and records, furniture, fixtures and equipment, including, but not limited to, used computers, used copiers, office furniture, computer monitors, printers and cubicles, located at the Debtor’s former premises at 1192 Borregas Avenue, Sunnyvale, California.
The Trustee believes that it is in the best interest of the estate to abandon the estate’s interest in the remaining records, furniture, fixtures and equipment because the records, furniture, fixtures and equipment are of inconsequential value and benefit, and are burdensome to the estate. The trustee estimates that the cost of sale would result in a net loss to the estate, and in addition the estate needs to avoid the possibility of rent or relocation expense.
Pursuant to Rule 6007 of the Federal Rules of Bankruptcy Procedure, a party in interest may file and serve on the undersigned an objection within 15 days of the mailing of the notice. If a timely objection is made, a hearing shall be set on notice to the objecting party, the United States Trustee and to other entities as the court may direct. If not timely objection is made, the abandonment shall be effective with or without entry of an order.
The assets and records are in the possession of Interex's landlord, Woodmont Real Estate Services. Interex listed the value of the office equipment, furnishings and supplies at a total of $24,558 in its bankruptcy filing. HP 3000 equipment is limited to a Series 70 Classic HP 3000 and a Series 925 server, purchased in 1989; HP 9000 gear includes two systems purchased for a total of $39,290 in 1998. The group purchased at least 11 laptops since 2000; records get cryptic after 2002. "Membership lists" have a separate entry on Schedule B of the filing.