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Autotech Leasing Services, LLC
Southern District of New York
Accountants for trustee, in alleged fraud case of automotive lease originator with $250 million portfolio of leases.
Frauds perpetrated by employees through underwriting and by management through fraudulent reporting to
lenders and double funding of leases.
Duties Included:
- Monitoring and supervising servicing of $250 million portfolio of leases.
- Evaluating and supporting litigation against directors, officers, sales staff, and automotive dealers
for fraud and avoidable transfers.
- Evaluating and supporting litigation against creditors and lenders regarding lender liability,
disguised financings and perfection of security interests.
- Evaluating and supporting preference litigation.
- Coordinating with governmental agencies regarding criminal proceedings.
- Adjudication of $300 million in claims.
- Reporting to the Creditors and Court.
NAL Financial Group, Inc.
Southern District of Florida
Represented NAL Financial Group (NAL) a publicly traded sub-prime lender as financial advisors to the
Chapter 11 debtors-in-possession. The company's primary financing sources include a warehouse facility,
and a revolving credit facility totaling approximately $150 million. NAL also securitized its portfolio of loan
contracts aggregating approximately $370 million in order to provide for additional liquidity. The plan of
reorganization was confirmed in a record six (6) months which yielded a distribution to unsecured creditors
of approximately eighty percent (80%).
Duties Included:
- Evaluation of creditor security interests.
- Preparation of cash flow budgets and comparison to actual. Preparation of monthly DIP reports.
- Evaluating and support negotiations on insider and trade avoidable transfers.
- Assisted in preparing the liquidation analysis required for the plan.
- Assist with formulation of Debtors Plan of Reorganization.
- Adjudication of claims in excess of $500 million.
- Reporting to the creditors and court.
Bentley Bay
Appointment in bankruptcy court as plan administrator of a consensual plan of reorganization.
Responsibilities included completing construction of a $100 million-plus interrupted condominium project
and completing and closing project sales, while maximizing the value of the project for interested creditors.
Biomed Plus, Inc.
Appointment in federal district court as receiver for $80 million in forfeited assets,
which are being liquidated under order of the court, and include $45 million in commercial and residential real
estate. The receivership has successfully liquidated or is liquidating these assets and is realizing over 90% of
appraised values for this estate.
Blue and Green Diamond
Appointment in bankruptcy court as plan administrator to complete plan implementation for a high-rise condominium project composed of two, 45-story towers. The engagement entailed resolution of more than $10 million in association turnover claims, supervising a sales office responsible for selling the remaining $18 million in unit and cabana inventory and evaluating and directing litigation claims of more than $30 million against design professionals, contractors and material men.
Breakwater Edison
Appointment as Chapter 11 bankruptcy trustee for an interrupted condo hotel project. Duties include collateral preservation, review and rectification of governmental notices of code violations, addressing outstanding tenant claims as they may affect the marketing, sale and value of the project and continuing oversight management of broker activities to sell the project in the near term. This appointment is ongoing.
Builders Plumbing Supply Corporation & Affiliates
In this large bankruptcy case filed in the Southern District of Chicago, Rachlin was retained to assist counsel with the defense of alleged fraudulent transfers to ex-owners of the debtor. Rachlin professionals, reviewed numerous documents pertaining to the debtor's financial condition to evaluate solvency and valuation of the debtor's assets. Rachlin's analyses and assistance in formulating defense strategy enabled counsel to negotiate a favorable settlement for its clients.
Diplomat Properties Ltd. v Sandy Babcock Inc.
Counsel for defendants hired Rachlin to rebut a report
prepared by hotel industry experts retained by Diplomat, a 5 star property in Hollywood Beach, Florida,
alleging damages to the extent of approx $17MM due to operational inefficiencies resulting from construction
issues. The parties agreed to arbitrate the matter. Partner Barry Mukamal's testimony, pursuant to a detailed
review of various documentation and depositions in the matter, resulted in the arbitration panel rejecting in
its entirety, the damage component relevant to Rachlin's engagement.
Exxon Mobil Corp. v. Allapattah Services, Inc., et al.
Exxon gas station operators filed a class action for
recovery of damages resulting from Exxon's overcharging for fuel purchases. Following a verdict entered for
the plaintiff dealers, Rachlin assisted in quantifying damages and accrued interest for claimants in 36 states
for a 12-year period. Damages totaled in excess of $1 Billion for approximately 10,000 class members.
Habana Libre
Barry Mukamal was appointed Chapter 7 Trustee on an underperforming South Florida boutique hotel to manage the marketing and sale of the hotel. Duties also include (i) the shadow management of the hotel's operation under a receiver as to its effect on the immediate recovery value of the estate, (ii) analysis of value added opportunities, such as branding options for the hotel, and reinstatement of the bar operation, (iii) facilitating the resolution of disputes between secured lenders, and (iv) claims analysis and recovery. The engagement is ongoing.
MainLine Corporation
In a bankruptcy proceeding involving this software development firm with large national contracts, Rachlin was retained to prepare solvency analyses in the context of litigation involving certain fraudulent conveyances. The engagement required the valuation of the debtor's business and its intellectual property. Relying on Rachlin's analyses and report, counsel was able to recover certain fraudulent transfers for the benefit of the estate.
Peninsula Mortgage Bankers Corporation ("PMBC")
In this Chapter 11 bankruptcy proceeding of a sub-prime mortgage lender and servicer also involved in real estate development, Rachlin was retained as the financial advisor to the debtor. In this role, Rachlin discharged numerous functions including detailed reconstruction of the debtor's loan portfolio to effect a sale, and forensic analysis of the debtor's cash transactions resulting in the identification of significant avoidable transfers consisting of common stock redemptions, dividend payouts, and direct and indirect payments to insiders and affiliates. The assignment also involved financial analysis of numerous real estate holdings through joint ventures and other investment vehicles, tax compliance involving foreign residents, and preparation of monthly operating reports for the court.
Thrifty v Steiner
Jointly retained by both the plaintiff and the defendant in this matter, Rachlin's engagement involved the valuation of certain restricted stock that had been transferred by insiders of a publicly traded company. In its analysis, Rachlin was required to quantify discounts resulting from the stock's restrictive attributes, its size, Rule 144 constraints, and relative liquidity due to thin trading in the marketplace. Rachlin's analysis assisted the parties in reaching a settlement, obviating the need for trial.
USA Labs / Cosmyl Inc.
Partner Barry Mukamal was appointed Chapter 11 Trustee for a business with manufacturing facilities located in Georgia and Alabama, and corporate offices in Florida. The company manufactured and distributed nationwide a wide range of products including low-end household cleaning products, low-end toiletries and high-end cosmetics and fragrances. Mr. Mukamal, with the support of Rachlin's turnaround team, operated the business for almost one year resolving regulatory, tax and employment issues; as well as implementing significant operational improvements, inventory control procedures, and cost-cutting measures. The company was sold as a going concern, and the trustee successfully litigated bankruptcy related litigation, resulting in multi-million dollar recoveries to the estate.
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