George L. Miller, Trustee

Eight Penn Center, Suite 950

1628 John F. Kennedy Boulevard

Philadelphia, PA  19103

 

Phone:  (215) 561-0950

Fax:  (215) 561-0330

Email:  [email protected]

 

 

March 16, 2007

 

STATUS UPDATE #14

 

NOTE: The Status Updates are cumulative. Please read all fourteen updates.

 

Litigation

 

I will not comment on pending litigation other than to describe the procedural status of such matters. Please review update #11 through 13 for additional information.

 

State Court Action

 

The Federal District Judge has decided that the Trustee’s request for a jury trial in Pennsylvania State Court in Philadelphia is the appropriate judicial forum for the Trustee’s lawsuit. The State Court Defendants will be required to respond to the Trustee’s allegations using PA law and procedures.

 

Bankruptcy Court Action

 

The Bankruptcy Court Judge has determined that the Trustee’s allegations of wrong doing by Greenwich, The Indenture Trustees, et al merit a trial. The Bankruptcy Court Judge has allowed the Trustee to amend his complaint in order to provide the Court additional information. On March 13, 2007, the Trustee filed an Amended Complaint against Greenwich, The Indenture Trustee, et al seeking damages in excess of $100,000,000.

 

In February 2007 the Trustee has identified certain assets of ABFS. The Trustee has filed a Motion with the Bankruptcy Court to allow the Trustee to pay Greenwich less than $200,000, which is the amount disputed by the Trustee that remains to be paid except for any indemnity claim which is not quantified and is also disputed by the Trustee. The Trustee has also requested to use $1,000,000 to pay professionals and other creditors in the administration of the Bankrupt Estate and prosecution of the State Court Actions and Bankruptcy Court Actions. Greenwich and the Indenture Trustees have objected to the use of any ABFS assets for use by the Trustee for any reason whatsoever, except to pay over to Greenwich any or all assets.

 

Both the State Court Action and Bankruptcy Court Action will likely take years to litigate unless settlements are reached between all parties.

 

Preferences

 

The Trustee is prosecuting the preferential payments under Sections 547, 548, 549, and 550 file Bankruptcy Code. See Status Update #13 for more information.