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Mette H Kurth
November 11, 2011
213.443.7547
mette.kurth@arentfox.com
Mette Kurth joined Arent Fox in 2008 to expand the firm’s Bankruptcy and Financial Restructuring Group to the West Coast. In 2012, this group was recognized by US News & World Report as a “Tier 2” bankruptcy practice, and Mette was recognized as a “Tier 1” bankruptcy lawyer. While perhaps nobody’s childhood dream is to become a bankruptcy lawyer, Mette comes close. With a background in economics, an earlier career in management, and a distrust of expensive, unproductive litigation tactics, Mette discovered early on that bankruptcy law, together with various non-bankruptcy options, provides a sophisticated set of tools that can be used to help borrowers, creditors, and investors develop pragmatic and creative solutions to even the most financially challenging circumstances. Of course, if consensual solutions don’t work, Mette has no compunction about resorting to bankruptcy litigation to achieve solutions. In the words of Theodore Roosevelt, “Speak softly and carry a big stick.”
Client WorkMette has experience in numerous industries, including retail, restaurants, health care, real estate, gaming, manufacturing and distribution, imports, fitness, financial services, agriculture, transportation, telecommunications, and multi-level marketing. Some representative matters are listed below. Debtors: Out-of-Court Workouts, Bankruptcy, and Bankruptcy Alternatives
- The Walking Company. Represented an $80 million, publicly-traded retailer of specialty footwear in a highly successful and rapidly-executed Chapter 11 reorganization that resulted in the payment in full of all unsecured creditors; a $10 million recapitalization of the company; the renegotiation of significant lease obligations; and the preservation of all of the company’s stores, substantially all of its employees, and its management team. This accomplishment was especially noteworthy as TWC is only one of a few retailers to have successfully reorganized since the Bankruptcy Code was overhauled in October of 2005. This deal made the Daily Journal’s Top 10 innovative in-house lawyers list. Mette’s work on behalf of TWC was also selected as the “Chapter 11 Reorganization of the Year” (Lower Middle Market) awards category by The M&A Advisor.
- Manufacturer & Distributor of Toner Cartridges. Currently representing a $35 million Southern California manufacturer and distributor of toner cartridges in an out-of-court work out and potential sale transaction.
- Nomoto Investments, LLC. Currently representing a single-asset real estate debtor with respect to a Chapter 11 reorganization to restructure the secured debt associated with its ownership and operation of a shopping center / strip mall in eastern California.
- In re Hi-Five Industries, LLC, In re One South Lake Street, LLC, and Wild Game Ng, LLC. Participated in the representation of the Siena Hotel Casino & Spa located in Reno, Nevada in its Chapter 11 case, which ultimately resulted in the sale of the businesses at a bankruptcy-auction.
- National Tanning Salon Franchisor. Represented this tanning-salon franchisor in implementing an out-of-court assignment for the benefit of creditors, or “ABC.” The transaction involved a strategic roll-up of various operating entities followed by the assignment of its assets to a Newco, all of which enabled the company to resolve its liabilities and emerge with an improved operating structure at the fraction of the time and expense of a traditional bankruptcy proceeding.
- International Norcent Technology, Inc. Represented a $13 million manufacturer and marketer of consumer electronic products in a Chapter 11 bankruptcy proceeding in response to a $45 million federal court judgment for patent infringement.
- Sun World International, Inc. Participated in the successful representation of a publicly-traded fresh vegetable and fruit grower and shipper generating $115 million in revenue in its Chapter 11 bankruptcy.
- Custom Food Products, Inc. Participated in the representation of a $109 million-revenue, publicly-traded meat and poultry processor as it implemented a Chapter 11 reorganization through a Dutch auction that successfully took the company private.
- Steel Horse Automotive, Inc. Represented a $70 million manufacturer and distributor of after-market automotive accessories in conducting orderly sales of its operating divisions. All sales were successfully completed, on time, despite a fire that destroyed a main manufacturing facility three days before the scheduled auction.
- World Bazaars, Inc. Represented a $55 million importer in disposing of the assets in its 600,000 sq. ft. warehouse. Among other things, this required bankruptcy counsel to quell an employee walkout and picket of the debtor’s facilities immediately after the filing, and to obtain those employees’ assistance with the company’s liquidation.
- Out-of-Court Workouts. Represented numerous companies — including real estate companies, developers, trucking companies, hospitals, medical practice groups, medical equipment manufacturers, retailers, printing companies, and individuals — in successful workout negotiations and other out-of-court solutions to financial challenges ranging from ongoing business losses, potentially catastrophic litigation claims and judgments, failed pension plans, over-leverage and insufficient liquidity.
Official Committees of Unsecured Creditors
- Contessa Premium Foods, Inc. Represented the official creditors’ committee in the Chapter 11 case of this California-based fine frozen food producer and retailer; successfully opposed an initial quick sale process and instead secured an auction process that resulted in the approval of the highest and best bidder for the debtor’s assets, resulting in 100% recoveries for unsecured creditors.
- Little Tokyo Partners, L.P. Represented the official creditors’ committee in the Chapter 11 case for the New Otani Hotel and the adjacent retail center in downtown Los Angeles, again successfully achieving 100% recoveries for unsecured creditors.
- McGrath’s Publick Fish House, Inc. Represented the creditors’ committee in the Chapter 11 case of this $17 million restaurant chain based in Salem, Oregon. The committee was formed when the debtor proposed to pay unsecured creditors only from the debtor’s future available cash, if any, while leaving all of the equity in the hands of the original owners. Within a few months, we successfully obtained an additional $1.5 million cash payment for unsecured creditors.
- Right Start Acquisition Company and Baby Style, Inc. Represented the creditors’ committee for Right Start, one of the largest national specialty retailers of juvenile products, and Baby Style, an on-line retailer of maternity and baby clothes and products, in their liquidating Chapter 11 case, which resulted in the orderly wind-down of the business through a series of going-out-of-business sales and a bankruptcy-court auction as well as the creation of a creditors’ trust to pursue litigation assets for the benefit of unsecured creditors.
- Norman J. Salter. Represented the creditors’ committee in the Chapter 11 case for Norman J. Salter (the 50% owner of the West Millennium Group, a developer of multi-family for sale and mixed use development in Southern California), with large number of interests in various real property LLCs and “single purpose entities” and personal guaranty liability in the hundreds of millions of dollars. The representation included a significant investigation of Mr. Salter and several of the West Millennium entities in order to ascertain whether any assets had been fraudulently transferred away from unsecured creditors and the resolution of various tax related matters to ensure a distribution to trade creditors.
- Crew Creative Advertising, LLC. Represented the creditors’ committee in the Chapter 11 case of this $10 million advertising company catering to Southern California’s movie and entertainment industry.
- Robert Henry Bisno. Represented the creditors’ committee in the Chapter 11 case of this Southern California real estate investor.
- Karawia Industries, Inc. Represented the creditors’ committee in the Chapter 11 case of this Southern California security and janitorial company.
- Bodies in Motion. Represented the official creditors’ committee of a regional fitness club in connection with the debtor’s efforts to sell its business; successfully opposed the debtor’s proposal to sell the company to an insider, and instead secured the approval of the highest and best bidder for the debtor’s assets, as selected by the committee, resulting in significant additional recoveries to unsecured creditors.
- The Walking Company. Co-counsel to the Creditors Committee for this $83-million revenue retailer of specialty footwear. Successfully opposed the debtor’s sale efforts and insider-sponsored plan, which ultimately resulted in the sale of the company to a third-party and significantly enhanced unsecured creditor recoveries.
Other Insolvency-Related Matters
- Asset Acquisitions. Currently representing the successful acquirer of a software company at a bankruptcy auction in the Northern District of California. Represented the successful acquirer of the assets of bankrupt shoe retailer Steve’s Shoes at a bankruptcy auction in Kansas City as well as numerous other investors evaluating potential distressed transactions and/or bidding at bankruptcy auctions.
- Individual Creditor Representations. Successfully represented secured and unsecured creditors seeking to propose and confirm creditors’ plans in pending Chapter 11 cases. Represented trustees of creditor trusts established pursuant to liquidating Chapter 11 plans, individual committee members and unsecured creditors asserting claims or defending against avoidance actions in bankruptcy cases across the country, and various other parties with interests in Chapter 11 cases.
- Indenture Trustees. Represented one of the largest commercial banks in the country in its capacity as Indenture Trustee in connection with significant Chapter 11 cases in the telecommunications industry, the airline industry, and the steel industry.
- Bankruptcy Appeals. Currently representing the acquirer of certain assets and litigation rights in the defense of an appeal pending in the Northern District of California. Represented several parties in both pursuing and defending against appeals of bankruptcy court orders, including an order approving a bankruptcy sale, an order approving a bankruptcy settlement, and an order denying a bankruptcy claim.
- Advising Boards of Directors. Frequently advise boards of directors with respect to bankruptcy-related matters such as the risks associated with potential defaults or bankruptcies by third parties such as vendors, customers and landlords; minimizing preference and credit-risk exposure when dealing with financially distressed business; resolving preference litigation.
- Accounts Receivable Put Options. Have advised companies regarding the use of complex financial tools such as account receivable put option contracts designed to minimize credit risk.
- FDIC Proceedings. Formerly employed as a Bank Liquidation Specialist with the FDIC, and am frequently consulted regarding political, process, and legal questions relating to the FDIC with respect to commercial loans, real estate loans, asset acquisitions, and the purchase of failing financial institutions.
- SIPIC Liquidation Proceedings. Have represented the trustee appointed under the Securities Investor Protection Act in the SIPC liquidation proceeding for a Glendale securities firm.
Professional Activities
- Turnaround Management Association
National Board of Directors (2009-Present)
National Committee Member, Various Committees (2008-Present)
President, Officer & Board Member, Southern California chapter (2004-2008)
- Turnaround Management Associations’ Western Regional Conference
Co-Chairman (2009)
- California Bankruptcy Forum, Conference
Co-Chairman (2009)
- Los Angeles Bankruptcy Forum
Officer & Member of the Board of Directors (2005-2008)
- Financial Lawyers Conference
Board of Governors (2005-2007)
- Member of various bar organizations, including the American Bankruptcy Institute, American Bar Association, Los Angeles Bankruptcy Forum, and the International Women’s Insolvency & Restructuring Confederation (IWIRC)
Recognitions and Awards
- Recipient of the “Transaction of the Year: Mid-Sized Company” award by the Turnaround Management Association (TMA) in 2012 for Mette’s role in representing the Official Committee of Unsecured Creditors in the Chapter 11 case filed by Contessa Premium Foods, Inc.
- Recognized by the Daily Journal as One of the Top Women Lawyers in California in 2011 and 2012.
- Included by US News & World Report and Best Lawyers in its inaugural rankings for Bankruptcy and Creditor-Debtor Rights Law in 2010, and again in 2011.
- Recognized by Best Lawyers in America in 2009,2010, 2011, 2012 and 2013 by the Southern California edition of Super Lawyer in 2009, 2010, 2011 and 2012 in Bankruptcy & Creditor/Debtor Rights.
- Under Mette’s leadership, the Southern California chapter of the Turnaround Management Association was recognized as “The Most Improved Chapter of the Year” for 2007.
Presentations
- 20th Annual ABI Southwest Bankruptcy Conference, Fundamental Skills Track (September 2012)
- Rossberg Group Webinar, Mastering Series on Bankruptcy (September 2011)
- Pincus Professional Education Webinar, Business Bankruptcy Boot Camp: Chapter 11 Demystified (September 2010)
- Association of Insolvency & Restructuring 26th Annual Bankruptcy and Restructuring Conference, Seeking “Safe Harbor” During an Economic Storm (June 2010)
- Association of Insolvency & Restructuring Advisors Webinar, Strategies for Distressed Retailers and Restaurants (May 2010)
- Strafford Teleconference, Prepackaged and Prenegotiated Chapter 11 Reorganizations (June 2009)
- Association for Corporate Growth Los Angeles Restructuring Panel, Strategic Options in Today’s Difficult Economy (April 2009)
- Association of Insolvency and Restructuring Advisors, Valcon 2009: Risk, Restructurings, Real Estate and Retail (February 2009)
- Webinar, Structuring & Completing Distressed Transactions in California: What Investors and Lenders Need to Know (November 2006)
- American Bar Association, Whose Case is it Anyway? Taking Control Through a Creditor Plan of Reorganization (2006 Spring Meeting)
Articles and Publications
- “Help Wanted (But Debtors Need Not Apply),”Arent Fox Legal Alert; September 9, 2011
- “The Chapter 11 Bankruptcy Venue Reform Act: A Change of Scenery for Large Corporate Debtors” Arent Fox Legal Alert; October 4, 2011
- “Why it Pays to Serve On a Creditors Committee” Arent Fox Legal Alert; February 8, 2011
- “Emerging Strategies for Bankruptcy Financing,” Inside the Minds: Debtor-in-Possession and Exit Financing, Thomson West/Aspatore Books (February 2010)
- “Bankruptcy Practitioners, Get Your Guns: Haberbush and Sherwood Partners Set the Stage for a Showdown Between the Code and State ABC Law,” American Bankruptcy Institute Journal, July/August 2006, Vol. XXV, No. 6., co-author
- “Ride-through Revisited (Again) — The Strategic Use of the Ride-through Doctrine in the Post-Catapult Era,” The American Bankruptcy Institute Journal (July 18, 2005)
- “The UNCITRAL Model Law on Cross-Border Insolvency Gains Momentum with its Incorporation into the United States Bankruptcy Code,” INSOL World (Third Quarter 2005)
- “List of Defendants Grows in Deepening Insolvency Cases: Advisors, Investment Bankers, and Lenders Are All at Risk,” The Journal of Corporate Renewal (January 2005)
- The Search for Accountability: The Emergence of “Deepening Insolvency” as an Independent Cause of Action, CORP. CORRUPTION LIT. REPORTER (June 2004)
Life Beyond the Law
- Mette is actively involved in supporting the activities of 4 Girls GLocal Leadership, an organization dedicated to providing mentoring and leadership programs for young women in underdeveloped countries.
- In 2008, she participated in the three-day, 40-mile Avon Walk for Breast Cancer, raising over $25,000 for that organization.
- She has served as a member of the resource board for the Sojourn Shelter, the second-oldest shelter-based service provider in the state of California, which provides battered women and their children a safe space to regroup, rebuild, and reestablish their self-esteem and lives.
EducationUniversity of California, Los Angeles , JD ( Order of the Coif; Chief Articles Editor, UCLA Law Review ) Trinity University , BA ( cum laude with University Honors; Phi Beta Kappa )
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