Majors

Save E-mail Print Most Popular RSS Reprints

Family assets to be seized in Fabrikant case

By Teresa Novellino
June 23, 2008

Similar Stories | Topics

New York—A bankruptcy judge has authorized U.S. marshals to take all necessary steps to seize the assets of the ex-owners of M. Fabrikant and Sons, including, if need be, busting into their apartments on Fifth Avenue and Park Avenue in Manhattan.

The order was issued on June 18 in response to a complaint filed in U.S. Bankruptcy Court in New York last week by the "shared assets trust," consisting of Fabrikant lenders and creditors. The trust seeks to recoup assets it claims the former owners of Fabrikant diverted to its affiliate companies before filing for Chapter 11 bankruptcy protection, court papers said.

"In the 16 months preceding Fabrikant's Chapter 11 filing, the Fortgang family, which owned and controlled Fabrikant, caused it to make fraudulent and preferential transfers totaling more than $100 million to affiliated companies—the affiliates—that were themselves owned and controlled by the Fortgang family," court papers said.

The judge's order says it will seek the following amounts from each of the defendants: Charles Fortgang ($87.6 million), Matthew Fortgang ($49.4 million), Susan Fortgang ($43.9 million), Marjorie Fortgang ($16.9 million) and Theresa Fortgang ($3.7 million). The order also names 12 of Fabrikant's affiliated companies.

U.S. Bankruptcy Court Judge Stuart Bernstein signed the order agreeing to the seizure of assets.

"Each of the attachment defendants, with an intent to defraud his, her or its creditors and/or to frustrate the enforcement of a judgment that might be rendered in plaintiff's favor has assigned, disposed of, encumbered or secreted property or removed it from the state or is about to any of these acts," the order said.

In a letter to Bernstein, Hunter Carter of Arent Fox LLP, an attorney for the defendants, requested a hearing.

"Our clients stand to be irreparably damaged by some of the provisions entered today," the letter says.

It was unclear at press time whether or not that request had been granted.

Editor's note: For earlier developments in this story, see Fabrikant creditors sue lenders.
Save E-mail Print Most Popular RSS Reprints

More Like This

Christian Bernard obtains trustee, plans to liquidate
January 16, 2009 | National Jeweler Network
Court approves Christian Bernard liquidation sale
January 19, 2009 | National Jeweler Network
Court approves auction of Fortunoff's assets
February 10, 2009 | National Jeweler Network
Ultra Stores files Chapter 11
April 09, 2009 | National Jeweler Network
Court releases assets of ex-Fabrikant owners
October 27, 2008 | National Jeweler Network
TOPICS
Business | Civil Trials | Company Activities and Information | Company Bankruptcies | Trials
More Watches

Design Portfolio

advertisement

Video

Small multi video player located on right rail of NJN site

advertisement

Sponsored by:

Retailer Toolbar

America's Best Jewelers
Join the ONLY Social Network for Jewelry Retailers. Get access to expert content, peer best practices, and more.
Start networking today.
Newsletters
Newsletters
Topic-specific newsletters that deliver the latest news on jewelry, diamonds, wholesale operations and high-volume buying directly to your in-box.
Reader Connect
ReaderConnect
Supplier information presented with every article, bringing you related, actionable content on every topic.
Jewelry Yellow Pages
Yellow Pages
A comprehensive listing of associations, organizations, suppliers and services for the jewelry industry.
Classifieds
Classifieds
A comprehensive listing of job postings, product offerings and other materials for sale for the jewelry industry.
NJN Customer Connect
CustomerConnect
The most sophisticated suite of marketing services available for jewelry retailers, from Internet tools to data marketing.

advertisement