Legal News

Got $42 Million? Judge Approves Firesale for Petters? Polaroid

By Dan Slater

With Madoff and Stanford dominating the front-page, it’s easy to forget about the trials of Tom Petters. After all, he’s way out there in Gopher Country, the land of casseroles, black ice and youbetcha.

Petters is at the center of what the FBI alleges may have been a broad-reaching, $3 billion Ponzi scheme that defrauded hedge funds. Back in October, Petters, founder of Minnetonka, Minn.-based Petters Group Worldwide — which has investments in, among other companies, Fingerhut, Polaroid and Sun Country — was arrested on charges of mail and wire fraud, money laundering and obstruction of justice.

Today, the trusty StarTribune reports movement on the Petters front. U.S. Bankruptcy Judge Gregory Kishel has approved the sale of Polaroid Group, one of the few assets of Petters Group Worldwide with tangible value, with bids to open at $42 million — a puny 10 percent of the $426 million Petters paid for Polariod in 2005. (Polaroid filed for Chapter 11 bankruptcy on December 18.)

Kishel approved the auction over the objections of two Petters creditors, Richie Capital Management and Acorn Capital Group, by saying that a bidding process is “fair, reasonable and appropriate” and is “designed to maximize the value” of the Petters estate.

Full post as published by Law Blog - WSJ.com on February 19, 2009 (boomark / email).