Schnader Attorneys Assist SK Foods Chapter 11 Trustee in Recovering $50 Million for CreditorsOn March 3, 2014 by Schnader in Litigation
SAN FRANCISCO – Completing a three-year effort on two continents, attorneys for Schnader Harrison Segal & Lewis LLP assisted Bradley Sharp, the Trustee of bankrupt California agribusiness giant SK Foods, LP (SKF) in recovering approximately $50 million in Australian assets for the benefit of SKF’s creditors.
Schnader’s undertaking involved insolvency proceedings and related litigation, in both the U.S. and Australia, to counter efforts by SKF’s former owner Scott Salyer to keep the Australian assets out of the SKF bankruptcy estate through a series of international transfers into trusts and off shore corporate entities. Roadblocks encountered on the way to success included litigating with the Australian liquidators over the true ownership of the Australian assets and a last minute attempt by the Australian Federal Police to confiscate the assets, claiming they were proceeds of Mr. Salyer’s criminal activity in the U.S.
“This was a group effort, with numerous moving parts and significant legal hurdles on both sides of the Pacific,” said Schnader partner Gregory C. Nuti. “We were pleased to assist Mr. Sharp in his relentless effort to ensure that the victims of Salyer’s crimes and creditors affected by SKF’s financial collapse finally would receive payment on their claims.”
SKF’s business collapsed in 2009 after a long running FBI investigation into Mr. Salyer’s business practices became public. Allegations of price fixing, bribery and selling tainted tomato products ruined SKF’s $270 million-per-year business, eventually landing Mr. Salyer in federal prison. The company’s downfall resulted in one of the largest Chapter 11 cases ever filed in the Eastern District of California.
During Mr. Sharp’s pursuit of the funds due SKF’s creditors, he, along with Schnader attorneys Kevin W. Coleman, Michael M. Carlson, and Mr. Nuti, overcame persistent roadblocks in the United States, the West Indies, the Cook Islands, Australia, and New Zealand. The effort involved legal proceedings in the U.S. Bankruptcy Court and U.S. district courts for the Eastern District of California, the Ninth Circuit Bankruptcy Appellate Panel, the Ninth Circuit Court of Appeals, the Federal Courts in Sydney and Adelaide, Australia, and the Supreme Court of Victoria in Melbourne, Australia. In the Australian proceedings, Schnader worked together with David Porter, Michael Rose and Fiona Palmer-Murray of the international law firm Norton Rose Fulbright.