U.S. Bankruptcy Court Approves Initial Distribution to NECCO’s Unsecured CreditorsMay 4, 2021
Harold B. Murphy, the Chapter 7 Trustee of New England Confectionery Co., Inc. (NECCO) announced today that United States Bankruptcy Judge Melvin Hoffman approved the Chapter 7 Trustee’s Motion to pay an initial distribution to NECCO’s unsecured creditors of 39 per cent of their approved claims.
The Bankruptcy Court’s approval of the initial distribution follows the Bankruptcy Court’s approval of the settlement of two lawsuits filed by Mr. Murphy, Co-Founder and Shareholder of Murphy & King, P.C., and his law firm, Murphy & King, P.C., against Ares Capital Corporation and certain of NECCO’s officers and directors. Under the settlement, the Chapter 7 Trustee recovered $7.4 million, Ares Capital waived approximately $150 million in claims against NECCO Candy and it assumed responsibility for a pension plan for certain of NECCO’s former employees.
“We’re pleased with the Court’s decision because it will enable us to make a significant payment to NECCO’s many creditors,” said Mr. Murphy. “At the outset of the case, it appeared highly unlikely that there would be any money available to pay creditors. The result here was due to an extraordinary effort by my law firm and my financial advisor, Verdolino & Lowey P.C. While NECCO was not able to be saved, many of its brands live on as a reminder of what was once a great company.”
About Murphy & King, Professional Corporation
Since 1980, Murphy & King, Professional Corporation has been “unraveling complexity” for its clients through prompt, practical and cost-effective solutions to the legal needs of individuals and businesses. From startup and incorporation, to maintaining day to day operations, to resolving internal and external disputes, Murphy & King attorneys are skilled at effectively and efficiently unraveling the inherent complexities of each client’s business to ensure that it can attain its maximum potential. The firm’s principal areas of practice are Business Litigation, Bankruptcy and Financial Restructuring, Corporate and Real Estate Transactions, and White Collar Defense and Internal Investigations.