Misery Index: Week of December 4, 2017


Luxury real estate developer Woodbridge Group lands in chapter 11 following probes of a potential $1bn fraud.

California-based Woodbridge Group of Companies LLC filed for chapter 11 in Wilmington, Del., on Dec. 4 looking to restructure more than $750m of debt while the Securities and Exchange Commission investigates allegations of what could be a $1 billion defrauding of investors. The company has been under the SEC’s microscope since September 2016 in connection with allegations of the sale of unregistered securities by unregistered brokers, among other things. Woodbridge cited the mounting legal costs and regulatory pressure that led to a loss of liquidity as the reasons the company was pushed into chapter 11. CEO Robert Shapiro resigned when the bankruptcy was filed but will remain a consultant throughout the cases. Los Angeles-based investment firm Hankey Capital is to provide $100m in financing to Woodbridge to fund the business during the bankruptcy cases.

Chief Restructuring Officer Lawrence Perkins’ declaration can be found here.


Defunct Manhattan-based solar panel company Level Solar files for chapter 11 after defaulting on loan.

Level Solar Inc. filed for chapter 11, listing assets of $50m-$100m and liabilities of $1m-$10m, just days after receiving a notice of default from lender Green Bank. The company ceased operations in September after having amassed over 2,000 photovoltaic rooftop solar panel customers. Third-party SUNation Solar Systems has stepped in and is providing services for Level Solar’s customers. As part of the bankruptcy case, the company intends to hire a forensic accounting firm to look into potential financial misconduct of a former company official.


Belgian Diamond company seeks chapter 11 protection in Delaware

Exelco International Limited filed for chapter 11 in Delaware, three months after wholly owned subsidiary Exelco North America filed for chapter 11 with the diamond company listing total assets and liabilities between $10m and $50m. Under the overall bankruptcy the company is currently looking to sell certain diamonds to SimplexDiam for $6m, pending court approval.

Separately, Belgian affiliate Exelco NV’s court-appointed foreign representatives in a pending Chapter 15 case filed in November are seeking to have the chapter 11 cases thrown out, asserting the chapter 11 petitions were filed in bad faith.


RDX Technologies finds itself in chapter 11, again.

Arizona-based RDX Technologies Corp., formerly doing business as Ridgeline Energy Services, has filed for chapter 11 yet again, after a 2015 filing was dismissed in May 2016. The energy service and water treatment provider lists assets of $500,000 to $1m and liabilities of $10m to $50m.


Ponderosa Energy files chapter 11 to stop unjust foreclosure

Ponderosa Energy says lender PPF engaged in “fraudulent, tortious and usurious predatory lending” that ultimately left the company with no option but to file for chapter 11 to put a halt to the foreclosure process initiated by PPF, allow an efficient forum to address their claims against PPF and restructure the business.  The company also says in filings that PPF interfered with their business operations and refused to pay Ponderosa millions in rebates owed. The petition lists total assets and liabilities between $1m and $10m

Ponderosa manager Richard Sands’ declaration can be found here.


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