U.S. Bank objects to Reagor-Dykes request for lenders to pay TT&L, trade-ins
Another lender has filed an objection to the Reagor-Dykes Auto Group's request to the bankruptcy court that retail lenders be ordered to pay customers' outstanding tax, title and license balances as well as trade-in liens.
Reagor-Dykes argues once it filed for bankruptcy its access to funds and lines of credit were cut off. This left some customers with unpaid TT&L or trade-ins. In some instances, customers are being asked for loan payment on both their new vehicle and the one they traded in.
U.S. Bank writes, despite efforts to pay TT&L to applicable government authority and to negotiate payment for outstanding liens, Reagor-Dykes and its chief restructuring officer have not provided needed paperwork and have not been helpful to resolve customer issues.
Further, U.S. Bank argues Reagor-Dykes request, for all lenders involved, totals more than $6 million in balances to be paid off. It's filing states, "In return for this coerced post-petition financing, Debtors [Reagor-Dykes] offer nothing more than an unsecured claim that the Retail Lenders already possess. Ford Credit not surprisingly supports this proposal."
The filing continues, "At best, the Motion is an ill-conceived effort, without any legal support, to escape responsibility for the Debtors’ pre-petition activities and obligations at the expense of the Retail Lenders. At worst, the Motion and the Ford Response are a direct and coordinated attempt by the Debtors and Ford Credit to use an expedited motion process (providing only nine days’ notice) to subvert over thirty entities’ due process rights and secure monetary relief before the various Retail Lenders have adequate time to assert their rights and protect their interests."
U.S. Bank also argues the expedited motion gives nine days' notice for action.
Another point argued by U.S. Bank, "Aside from the absurdity of this procedural posture, the Debtors simply do not have standing to assert the rights of third parties under well-established federal jurisprudence."
Also, U.S. Bank's attorney writes Reagor-Dykes' motion lacks specificity to the amount of TT&L and trade-in liens, which lender is obligated for what, the proposed timing of any court-mandated financing, and the process to make sure customers get clear titles.
Another issue raised in several other filings and previous court hearings is the relationship between Reagor-Dykes companies that have filed for bankruptcy protection and those that have not. According to this objection, "Additionally, as stated by Ford Credit, the matter is further complicated by “the transfer of vehicles and titles between and among the RD Dealerships and the Non-Bankruptcy RD Dealerships. One of the Non-Bankrupt RD Dealerships was a used car only seller ... and many used vehicles traded to the RD Dealerships were apparently transferred to [it] with little or no documentation and uncertain consideration.” [Doc. 368, p. 15.] The Motion provides no mechanism for locating and securing the collateral for the Trade Liens before payment, for asserting a corresponding claim against the non-Debtor Dealership for any transfers, or for confirming that the outstanding TT&L and Trade Liens relates to one of the Debtors. Given these omissions, the Debtors’ already inadequate attempt to allow the Retail Lender to assert an unsecured claim against one of the Debtor’s estates becomes even more trivial."
The judge will hear arguments on this motion Thursday.
MONDAY: Compromise on vehicles in First Bank & Trust lawsuit v. Reagor Auto Mall
MONDAY: Judge approves sale of Reagor-Dykes plane; Wells Fargo objects to portion of TT&L motion
OCT. 12: Ford Credit supports part of Reagor-Dykes' request for lenders to pay TT&L, trade-ins
OCT. 12: FirstCapital files counterclaim, motion to dismiss
OCT. 10: Reagor-Dykes aircraft to be sold, pending court approval
OCT. 10: Several filings in Reagor-Dykes bankruptcy case
OCT. 1: KamKad, Reagor-Dykes execute purchase agreement
SEPT. 24: FirstCapital Bank requests First Bank & Trust lawsuit against it, Reagor-Dykes, others move to federal court
SEPT. 21: Judge sets schedule, trial date in Vista Bank v FirstCapital Bank lawsuit
SEPT. 21: Former Reagor-Dykes CFO denies late payments, says Vista Bank attacked him, his family
SEPT. 20: Vista Bank sues former Reagor-Dykes CFO, claims loan default
SEPT. 19: Texas DMV: Reagor-Dykes should promptly resolve title issues
SEPT. 19: Brad, Kenneth Burgess file motion to dismiss Vista Bank lawsuit
SEPT. 18: First Capital Bank files motion to dismiss lawsuit
SEPT. 18: Court approves bid process for Reagor-Dykes Auto Group, extends use of cash collateral
SEPT. 17: Ford Credit, GM object to certain aspects of proposed Reagor-Dykes sale
SEPT. 14: Judge sets trial date in Ford Credit lawsuit vs. Reagor-Dykes
SEPT. 14: Reagor denies Ford Credit's claim vehicles sold out of trust
SEPT. 13: Dykes: Former Reagor-Dykes CFO admits he provided false info to Ford Credit
SEPT. 11: Reagor-Dykes Auto Group requests court to allow sale of company
SEPT. 4: Reagor-Dykes Auto Group establishes process to resolve customer problems
AUG. 31: International Bank of Commerce asks for court to allow it to foreclose on Reagor-Dykes dealerships
AUG. 31: More Reagor-Dykes companies, co-owners may soon file for chapter 11
AUG. 30: Court extends Reagor-Dykes employment of CRO; officer discusses potential dealership buyers
AUG. 29 : International Bank of Commerce asks for loan payment in Reagor-Dykes case
AUG. 29: Ford Credit objects to Reagor-Dykes earlier legal team
AUG. 27: Vista Bank doubles relief request in new federal suit against FirstCapital Bank
AUG. 25: Reagor-Dykes chief restructuring officer hires new legal team
AUG. 25: GM proceeding with termination of Reagor-Dykes Floydada
AUG. 23: Landlords demand rent for Reagor-Dykes dealerships in Lubbock, Plainview
AUG. 20: Ford Credit moves ahead with suit against Reagor, Dykes, some R-D companies
AUG. 18: Reagor-Dykes bankruptcy case: Read court order following Aug. 16 hearing
AUG. 17: Auto dealer claims Reagor-Dykes owes $513,000, vehicles may be in consumers' possession
AUG. 16: Vista Bank sues FirstCapital for $6 million, claims Dykes helped perpetrate check kiting scheme
AUG. 16: Bankruptcy court allows Reagor-Dykes continued use of cash collateral, hiring of CRO
AUG. 15: Reagor-Dykes Auto Group issues written apology
AUG. 14: Loss of Reagor-Dykes Chevrolet in Floydada a potential financial pitfall for city
AUG. 14: Vehicle auction company claims Reagor-Dykes owes it $687,000
AUG. 14: Ford Credit claims Reagor-Dykes is not following court orders; court grants extension to file docs
AUG. 13: U.S. Trustee opposes Reagor-Dykes request to hire chief restructuring officer
AUG. 10: Ford Credit: Reagor-Dykes fraud may be among largest of its type in U.S. history; GM files to terminate Floydada dealership
AUG. 9: Reagor-Dykes questions former CFO’s actions; Contractor claims $700,000 due now
AUG. 7: Former Reagor-Dykes employees claim they were not paid
AUG. 6: Customers concerned over Reagor-Dykes 'unwinding' process
AUG. 6: Ford suit against Reagor-Dykes on hold while bankruptcy case proceeds
AUG. 3: Judge approves Reagor-Dykes employee pay
AUG. 2: Mayor: Downtown Lubbock growth to remain strong regardless of Reagor-Dykes future
INITIAL STORY: Ford Motor Credit sues Reagor-Dykes; R-D files for chapter 11 bankruptcy