MPC files for Chapter 11 bankruptcy
newsroom@idahopress.com
Saturday, November 8th, 2008
NAMPA — After announcing nearly 300 job cuts in the last three weeks, Nampa-based MPC Corporation announced Friday on its Web site that officials have filed voluntary petitions for Chapter 11 bankruptcy.
The filings were made in the United States Bankruptcy Court for the District of Delaware and apply to MPC and all its direct and indirect subsidiaries. MPC expects to keep its operations up and running during the reorganization process, its Web site said.
MPC declared total assets of $258.3 million, and debts of about $277.8 million.
By Jon Meyer
jmeyer@idahopress.com
NAMPA — Prior to MPC’s Chapter 11 bankruptcy filings, Boise attorney Daniel Williams says one of his clients filed a class-action lawsuit against the company over promised severance payments that allegedly were never delivered.
“Any way you look at it legally, MPC is bound by their agreement to pay laid-off employees,” the Thomas, Williams & Park, LLP attorney said in a press release.
MPC officials did not immediately return a request for comment Friday evening.
Williams says he knows of about 100 people affected similarly by payments that weren’t delivered. But Friday’s bankruptcy filing may force Williams and his client to now step back and put things on hold, he said.
“This means that at least a significant portion of our claim would be handled by the Delaware Bankruptcy Court,” he said.
The class-action complaint alleges that after the employee was laid off in late August, MPC entered into an agreement for biweekly severance payments.
According to the filing, the plaintiff allegedly received a letter on MPC letterhead, dated Oct. 30, stated that MPC “is unable to fulfill your current severance obligations” and that “payments schedule[d] ... to occur on October 31, 2008 and going forward will not be processed.”
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“Unforeseen issues” left the company with few alternatives and “extensive losses,” MPC CEO John Yeros said in a press release. “We evaluated all strategic alternatives, and concluded that the filing was necessary at this time.”
In a letter to the Idaho Department of Labor, MPC area Vice President Jody G. Sitts said MPC’s supply chain manufacturer, Flextronics Computing Mauritius Limited, “will no longer supply product or services to MPC under the terms of our manufacturing services agreement.” Sitts also indicated that MPC had been unable to find another supplier to work with.
The announcement came after the Wednesday layoffs of more than 200 employees in MPC’s Nampa plant. The company also cut about 80 jobs in mid-October.
“For the last month I expected something like this to happen,” former Tech Support Rep. Susan Harris said Wednesday about her job loss. Other employees Wednesday indicated they knew the company was under economic stress, but they gave no indication of a pending bankruptcy filing. MPC, known as one of the city’s largest employers, once boasted a workforce in excess of 2,000.
MPC Corporation’s stock and warrants have been de-listed from the New York Stock Exchange Alternext US LLC. An MPC press release stated the company does not anticipate that there will be any distribution to equity holders in conjunction with the bankruptcy cases.
