Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

CU System
Centrix hearing on expedited discovery motion is today
DENVER, Colo. (2/13/08)--A non-evidentiary hearing in the subprime auto lender Centrix Financial bankruptcy case will be held today about a motion asking the judge to reconsider her order granting expedited discovery in the case. The telephone conference hearing before Judge Elizabeth E. Brown of the U.S. Bankruptcy Court for the District of Colorado is set to begin at 1:30 p.m. MST and will likely involve scheduling further meetings. A debtors committee, representing the several Centrix-affiliated companies, filed an objection Monday to a motion filed Friday by the Ad Hoc Committee of Credit Unions, a group of creditors. On March 27, 2007, the Ad Hoc Committee of Credit Unions filed a motion for administrative expenses for making a substantial contribution in the cases. The debtors committee objected but also began settlement negotiations with the Ad Hoc Committee to try to avoid more litigation expenses, according to the debtors committee filing. During the negotiations, which continued throughout 2007, the debtors committee said it believed the administration matters could also be resolved consensually. It was surprised when the Ad Hoc Committee contested the contribution motion but began to prepare for a hearing and drafted discovery requests. The Ad Hoc Committee said it couldn't compile the information requested within 14 days and asked the judge to reconsider her expedited-discovery order. The committees were formed because there were so many debtor companies and so many credit unions represented as creditors in the bankruptcy case. In another development, a letter to the court from the regional director of the Employee Benefits Security Administration, withdrew the U.S. Department of Labor's claims related to Centrix Financial's 401(k) plan. The Secretary of Labor had filed a proof of claim on Jan. 8, 2007, to protect the interests in the plan and any participants who incurred losses, according to court documents. On July 11, 2007, the fiduciaries of the company's plan "restored all losses that may have been incurred by participants and paid the full amount" of the claim, the letter, which was received by the court Feb. 6. Meanwhile, trade press have reported that the insurer for Centrix Financial, Lyndon Property Insurance, has sued about three dozen credit unions alleging they worked with Centrix to commit insurance fraud by not reporting all Default Protection Insurance (DPI) claims. The credit unions, reported Credit Union Journal Monday, have asked the bankruptcy judge for a jury trial.


RSS print
News Now LiveWire
#NewsNow: Wal-Mart to issue EMV MasterCards within next few weeks. http://t.co/9csqwhFEdB
20 minutes ago
#UMich consumer confidence index bounces back in August http://t.co/LJ1l7mk4Ty
50 minutes ago
IPSOS survey: Canada's #creditunions top for member service 10th consecutive year @CanadianCentral http://t.co/dSipMd4qnz
1 hours ago
#NewsNow Home-state visits connect lawmakers, credit unions http://t.co/Ti7HdH9gFo
1 hours ago
#NewsNow: IOSCO head says the next major financial shock will come from a cyberattack. http://t.co/CrtMdYuTqY
1 hours ago