Fox Ortega Enterprises faces challenge in attempt to liquidate assets

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During a Wednesday bankruptcy hearing for Fox Ortega Enterprises, a company that owns the Berkeley wine store Premier Cru, one of the company’s creditors contested the proposed sale of Premier Cru’s more than 78,800 bottles of wine — the latest legal action facing the company that has been embroiled in a slew of lawsuits.

Michael Kasolas — who is responsible for reviewing and liquidating the company’s assets — filed a motion March 29 to sell Premier Cru’s wine in order to gain funds to repay creditors. But Edwin Finch, who filed the stipulation against the motion Wednesday, said he wants purchased bottles to be delivered rather than be sold.

According to Finch, if the wine were to be sold, he would be getting “10 cents on the dollar max, maybe more like three.” With Fox Ortega Enterprises heavily in debt, the bankruptcy code prioritizes certain parties in terms of distributing money.

But a scenario in which creditors receive their wine is unlikely, according to Tom Boothe, an attorney and one of the plaintiffs who previously filed a lawsuit against Fox Ortega Enterprises.

“(The creditors) don’t have claims to the wine on the floor,” Boothe said. He added that only if the wine had left the warehouse or was delivered would the purchaser have a claim.

But another creditor, William Witte, alleges that he has a claim to a share of the wine. On April 19, he filed a brief in opposition to Fox Ortega Enterprises’ motion to sell their wine, claiming that his wine had been “packed and on a cart at the warehouse door ready to be picked-up” the day the company filed for bankruptcy.

Prior to declaring Chapter 7 bankruptcy Jan. 8, the company faced several lawsuits from customers who allege that the wine they had ordered was never delivered. On Feb. 8, owner John Fox also filed Chapter 7 bankruptcy.

The court has yet to rule on whether Kasolas can liquidate Fox Ortega Enterprises assets and sell the bottles of wine.

Contact Alex Fang at [email protected] and follow him on Twitter at @alexfang_DC.