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]



October 5, 2011




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




     On or about November 17, 2008, the Trustee commenced an arbitration proceeding against BDO Seidman, LLP (now known as BDO USA, LLP) ("BDO") before the American Arbitration Association, docketed at AAA No. 14-107-Y-01840-08 (the "BDO Arbitration") wherein the Trustee asserted claims on behalf of the bankruptcy estate for damages for auditor malpractice, breach of contract, breach of fiduciary duty and related claims.  BDO was the external auditor for ABFS from 2000 through 2004. The BDO Arbitration was conducted by the Trustee and BDO over 26 hearing days, in which the panel of arbitrators (the "Arbitration Panel") heard testimony from 14 fact witnesses and expert witnesses and admitted hundreds of documents as hearing exhibits. Prior to the issuance by the Arbitration Panel in the BDO Arbitration of an award (the "Arbitration Award"), the Trustee and BDO entered into a settlement agreement which provided that if the Arbitration Award was (i) in an amount between $0 to $17.5 million that  BDO would pay the Trustee the full amount of $17.5 million ,or, (ii) in an amount in excess of $17.5 million then BDO would pay the Trustee the lesser of the amount actually awarded ,or the sum of $57 million (the "BDO Settlement").The BDO Settlement was approved by the Bankruptcy Court on July 29,2011. The Panel of Arbitrators entered an Arbitration Award which determined that BDO was not the proximate cause of damages asserted by the Trustee on behalf of the bankruptcy estate and awarded $0.00 in damages. Accordingly pursuant to the BDO Settlement the Trustee will be paid $17.5 million by BDO in full settlement of the claims made in the BDO Arbitration.