HRK bankruptcy heads to court

jsalman@bradenton.comJuly 3, 2012 

PALMETTO -- Port Manatee is among 60 creditors slated to attend a hearing Tuesday in Tampa to argue they should be paid before the employees of troubled HRK Holdings LLC.

The emergency hearing is the first formal step in HRK's Chapter 11 bankruptcy case, sprung largely by expenses associated with gypsum stack liner leaks last year at the company's Piney Point facility in Palmetto.

HRK has requested to pay two weeks' worth of back salaries and benefits to 15 unnamed employees totaling $42,000 before its remaining assets are split among creditors.

Some stakeholders suspect those wages are earmarked for HRK CEO Jordan Levy and other high-ranking company officials -- a request they plan to fight if true.

"If someone's out there working hard in the sun every day, they're not the ones we're worried about, but these owners shouldn't be paid," said Jim Mikes, whose company is owed $250,000 by HRK. "There's so many people claiming they're owed so much money. Where there's smoke, there has to be fire."

HRK filed for Chapter 11 bankruptcy protection June 27 to ward off more than 60 creditors, a list that includes names ranging from the IRS to Florida Department of Environmental Protection and surveyors in Palmetto.

The liability is estimated to

total upwards of $50 million, including about $20 million of debt to Regions Bank alone, court records show.

The Manatee County Port Authority has been pursuing financial damages from HRK for its role in the dredging of Berth 12, which had months of delays due to leaks in the pipes and storage sites that housed the dredged material at Piney Point, a former phosphate facility owned by HRK.

The project was completed in October, but while dredging was under way last May, the storage liners at Piney Point sprung leaks into Bishop Harbor.

The port now is paying a $3.28 million settlement to the Michigan dredging contractor that filed suit over the added expenses.

The port has been aggressively seeking repayment from HRK for its responsibility. Attorneys representing the port at the Bradenton law firm Lewis, Longman and Walker didn't return several phone calls seeking comment.

"It's going to have to go its course in the courts, and I believe we're pretty much covered," Port Chairman Larry Bustle said Monday. "Our attorneys are working closely in the bankruptcy filing and fighting for our best interests."

A court trustee will decide what creditors receive a payment and how much.

HRK also has a pending lawsuit against the engineers, consultants and contractors that designed and installed the liner system.

The company plans to continue service to customers and tenants until the bankruptcy case is resolved.

The emergency hearing has been scheduled for 2 p.m. Tuesday at the U.S. Bankruptcy Court of the Middle District of Florida in Tampa, courtroom 9B.

"HRK intends to maintain its close working relationship with DEP and the Manatee County Port Authority during the Chapter 11 process, the primary purpose of which is to protect the site and its surrounding environment, as well as the substantial investment in the site by HRK and its investors and lenders," Levy said in a statement last week.

Josh Salman, Herald business writer, can be reached at 941-745-7095. Follow him on Twitter @JoshSalman.

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