Judge Suggests Mediation to Save Hostess; Sides Agree to Talk.

WSJ ^

[Perdogg]

Dow Jones is reporting that a bankruptcy judge is urging mediation to save Hostess from liquidation. WSJ will have more to come as it comes out of the courtroom.

Here’s an update from bankruptcy reporters Jacqueline Palank and Rachel Feintzeig

A bankruptcy judge Monday asked whether he should preside over mediation between Hostess Brands Inc. and its striking union to avoid pulling the plug on the baker of Ho Hos, Twinkies and Wonder Bread.

[Dr. Sivana]

The owner of a company I used to work for filed for bankruptcy, and as it was the second time, the creditors were ultimately trying to force serious changes. It turned into a heave-ho match with the owner unwilling to make any significant concessions, and the creditors unwilling to lose all of their money.

The judge wanted to them to work things out to avoid a Trustee. Well, it didn't happen, and an extra $2 million was wasted in the court room of a small company with most small time creeditors who could have used it. At times, lawyers would spend the better part of a billable hour in court arguing over which fund pays for the lawyers fees. It was right out of Dickens' Bleak House.

In the end, the result was the same as would have been had the judge been able to realize that one side was completely intractable, and the other was largely intractable. This cost the business three years and two million dollars, neither of which it really had, and everyone was the poorer for it.

[stephenjohnbanker]

: )

[NY.SS-Bar9]

and everyone was the poorer for it.

Except the lawyers.

[wrencher]

“and everyone was the poorer for it.”

Not everyone, the lawyers for both sides were probably toasting each other during the feasts.

[supremedoctrine]

Which only underscores the imperishable truth that “It’s all about the lawyers” (followed by the Courts and the Judges).

[RedMDer]

FReepers are the greatest!! Woo hoo!! And we’re now working on the last $8k!! We can do this.

[ArmstedFragg]

I once sat through a public meeting where an organization known as “The Association of the Gay, Lesbian, Bisexual, Transgendered, and Confused” made an appearance. One wag commented that someone who was the first four would definitely be the fifth.

[stephenjohnbanker]

No doubt : )

[cherry]

I can't believe that there are so many freepers into store bought sugary fatty creations.....doesn't any body bake at home anymore?

but to the point....some workers have come out publicly and said that they hope the company goes bankrupt because they don't want to work for them anymore...

[rfp1234]

Medication? Meditation? Oh, never mind.

[Ron H.]

The unions do not want to compromise at all

The union backed itself into a corner and cannot be seen as compromising as it would likely be seen as backing down and losing face, IMHO.

[GeronL]

Hostess would have been half owned by the workers under the proposed contract.

They don’t want to work for themselves either.

[GeronL]

Bleak Twinkies

[matt04]

The Teamsters compromised and took a 8% pay cut. Hostess wanted the same thing of the bakers union. They refused to budge multiple times. I don’t see that changing.

[elkfersupper]

The lawyers get paid first in any bankruptcy.

It's like gravity. It's the LAW.

[elkfersupper]

Well at least we still gots RC Cola and MoonPies for lunch!

In 'Merica, anyway.

The rest of the U.S. may just have to suffer.

[onyx]

We sure need some here.
FReepathon Day 50!

[Uncle Chip]

Sell it — too much featherbedding in the current economic model. A new buyer will pay more for the assets if it doesn’t have to deal with the unions.

[FR_addict]

Not good to have the teamsters union mad at you.

The bakers union might want to reconsider.

[supremedoctrine]

btt