Case #935

$200 million IT consulting services provider

Formed through the roll-up of smaller regional companies, this company offered IT consulting services for large clients as well as internet start-ups on an international basis.

Debtor's attorneys and Creditors' Committee attorneys had battled throughout the contentious Chapter 11 case, and as part of the Liquidating Plan, both sides agreed to bring in a Special Litigation Trustee that both parties trusted and was viewed as totally independent to handle litigation as it pertained to their constituencies. Thus, Morris-Anderson & Associates was hired to evaluate specific potential claims and causes of actions (lawsuits) that may have significant value to the debtor’s estate. On the debtor side, the issues involved Director and Officer (D&O) liabilities, preference recovery and excess payments to Officers. On the Committee side, issues involved preference recovery and claim resolution.

After business, accounting and legal investigation, we filed lawsuits, through our attorneys against the D&O's, one ex-Officer for a multi-million dollar preference and for repayment of excessive executive compensation as well as against two Committee members for smaller preferences. Additionally, we have objected to the size of certain claims filed by Committee members. We estimate that the actions taken by us as the Trustee will generate several millions of dollars of recovery to the estate at an investment of a fraction of that cost. These actions will greatly improve the expected net recovery pool available for the creditors of this case.