Penn Dutch seeks court order for passwords
The company Penn Dutch assigned to oversee its dissolution says it needs computer passwords to access the company’s financial records.
But Penn Dutch executives haven’t provided those passwords “despite repeated requests,” said Philip von Kahle of the insolvency firm Michael Moecker & Associates, in a recent court filing.
Kahle is seeking a judge’s order requiring Penn Dutch executives to provide computer passwords and other access credentials. A hearing on the request has been scheduled for Jan. 8 before Circuit Judge Jack Tuter in Fort Lauderdale.
Penn Dutch assigned Michael Moecker & Associates to oversee distribution of the company’s remaining assets to creditors in late September, days after listeria contamination forced the company to permanently close its Hollywood and Margate locations.
Statements filed by the insolvency firm showed that Penn Dutch had assets valued at $670,120 while owing creditors $6.68 million.
Such assignments, filed in state court, help companies dissolve quicker and for lower cost than if they file for bankruptcy in federal court, largely because dissolving companies agree to work closely with the assignees to expedite the process, said Robert Charbonneau, attorney with Agentis Law, a Coral Gable-based firm specializing in bankruptcy restructuring.
Charbonneau, who is not involved with the Penn Dutch case and is unfamiliar with its details, said it would be “very unusual” for a dissolving company to refuse to hand over all of its records to an assignee.
Assignments are usually fully collaborative, he said. “You have meetings, you figure out whether any money is going to be left in the accounts, then you have full cooperation.” The dissolving company “assigns everything, and I mean everything — all the assets and liabilities — to the assignee who’s responsible for the wind down.”
Von Kahle and his attorney, Jason Slatkin, did not respond to emails or phone calls seeking further information about their request for a court order.
Penn Dutch’s attorney, Chad Pugatch, said Penn Dutch executives turned over all requested credentials early in the process. Pugatch said he was told the passwords didn’t work for some reason and that Penn Dutch’s data storage company, Hollywoodbased Palindrome Consulting, has to boot up the company’s main server for the passwords to work.
But Ilan Sredni, Palindrome’s owner, said that his company provided von Kahle with “everything asked from us.”
“We gave them administrative access to the server, helped them move over information, and explained what the servers were doing,” Sredni said, adding he hasn’t heard from von Kahle in over a month.
Von Kahle’s request for a court order was filed two weeks ago, on Dec. 6, by his attorney, Jason E. Slatkin of Fort Lauderdale-based Slatkin & Reynolds P.A. The request said that state law requires assigning companies to deliver to the assignee all assets of the estate in the company’s control, including “all accounts, books, papers, records and other documents.”
“Again, despite repeated requests for the same, Assignors have not delivered to Assignee the computer passwords and other access credentials needed for Assignee to be able to review all of Assignor’s books and records,” the motion states.