Bankruptcy judge freezes assets of US Fidelis owners
U.S. Bankruptcy Judge Charles E. Rendlen III on Wednesday issued a temporary order that freezes the personal assets of US Fidelis owners Darain and Cory Atkinson and halts most lawsuits against the brothers.
The order, sought by creditors of the Wentzville-based seller of auto service contracts, expires July 8. The company filed for bankruptcy on March 1.
David Warfield, a lawyer representing a creditors committee, said the order was necessary to preserve assets the Atkinsons owe to US Fidelis and — by extension — the company owes to creditors, including hundreds of consumers.
In support of the order, Warfield filed with the court a financial report stating the Atkinsons were paid about $217 million in shareholder distributions from 2004 through last year. In addition, the filing stated the brothers received loans from the company totaling about $75 million in 2008 and 2009.
Norman Pressman, Darain Atkinson’s lawyer in the bankruptcy case, told Rendlen that he proposed a settlement last month at a meeting with the Missouri attorney general’s office and lawyers for other interested parties.
Pressman said of his client, "He is willing to fall on his sword. He is willing to surrender virtually all of his assets."
Warfield said after the hearing that he is cautiously optimistic about Pressman’s offer.
"We’re seeing the effort, but we’re not seeing the money," he said. "And it’s all about seeing the money."
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