Georgia Bankruptcy Blog

An involuntary Chapter 11 Bankruptcy Petition was filed against Ply-Marts, Inc. (a/k/a Ply-Mart and PlyMart) on July 1, 2008. Ch. 11 (Invol.) Case No. 08-72687.  See the petition here. The petition was signed by Dixie Plywood Company of Atlanta, JB Hunt Transport, Inc., and Primesource Building Products, Inc..

As discussed in this post, Ply-Marts consented to the appointment of a receiver in the U.S. District Court last week. 

The primary element required to prevail on an involuntary petition is that the would-be debtor is not paying its debts as they become due.  See 11 U.S.C. §303.  Given the Consent Order in the District Court case, it will be difficult for Ply-Marts to overcome this allegation -

E . In the fall and winter of 2007, Ply-Marts experienced significant financial difficulties, and by no later than early 2008, events of Default under (and as defined in) the Loan Agreement had occurred and continue to exist .problems have intensified and accelerated to the point that there is imminent danger that Plaintiffs interests in the Ply-Marts Collateral will be irreparably harmed.

G. Ply-Marts' financial problems have intensified and accelerated to the point that there is imminent danger that Plaintiffs interests in the Ply-Marts Collateral will be irreparably harmed.

H. Ply-Marts has commenced an orderly wind-down and liquidation of its lumber products business . The remaining operating divisions of Ply-Marts have sustained and continue to sustain substantial operating losses .

It appears more likely that Ply-Marts will either not contest the involuntary petition, as in most cases, or it could file its own Chapter 7 or 11 petition.  Although the Receiver is still in control of the company, its board of directors likely have the authority to consent to bankruptcy relief even over the objection of the Receiver.

I didn't know an involuntary bankruptcy even existed. I suppose if a debtor leaves no other alternative...

HAHAHAHAHAHA.........

I am so glad that PlyMart hit the skids... I was a distressed home owner that got blind sided by a builder that took the draw money and ran leaving me with $14.7K bill. I called them and said that I did not want to pay it off now, please wait for 2 weeks, and I would pay it off, no questions asked, it was done. I was dealing with a corrupt builder, Donald James Chancey, and I was trying to minimize the damages that he inflicted on me. They agreed and then 2 week later went I went there to pay the bill, they hit me with another $300 charge for late fees and a cancel check fee, from the builder. When I asked them, “what are you going to do about the guy that committed the crime?”, i.e. Mr Chancey that canceled the check that I watched him deliver to the store, they guy on the phone said, “Listen, the bill is now 15K, you going to pay it or not?”

The grand jury came back with 8 counts of “felony theft” against the builder, and he finally pleaded guilty to the charges. It just about bankrupt me, about caused a divorce, and made me miss the first 6 months of my daughter’s life because I had to finish the house by myself.

PlyMart was all about them, “I am out for me, screw the little people”. I told Mr. Mahaffey that I would “I will pay twice as much to get half the quality then to ever deal with your company again.”. I mean it…. If he would have manned up enough to give me the 11 screens (for the windows that I am missing) , or even offered them to me at a discount price, I would have jumped on that.

PlyMart is out of business… and i applaud that!