SAN ANTONIO, TX — Cardell Cabinetry creditors were given until May 19, 2014 to file claims against the bankrupt kitchen cabinet manufacturer, in an order issued yesterday by Judge Craig Cargotta in Western Texas District Bankruptcy Court.
The 900-employee Cardell Cabinetry, one of the largest U.S. cabinetry manufacturers, closed its doors without warning in Sept. 2013, leading to an involuntary bankruptcy filing which has been wending its way through the court since.
On Feb. 24, creditors Valendrawers, Hardwoods of Michigan, and PAVEN Inc. - who brought the original demand for bankruptcy with claims of over $1 million - sought to depose Wells Fargo Bank, a formal examination procedure that could allow them discovery of any assets of Cardell not yet disclosed. Wells Fargo, also a creditor of Cardell, told Judge Cargotta yesteray it has established an arrangement for the deposition with the creditors.
Early in February, Cardell Cabinetry's court-appointed receiver sued "at least seven national distributors and home remodeling companies that bankruptcy court filings show owe Cardell a combined $4.4 million."
Redeeming the accounts receivable will help the company pay off some of its debts, though an auction by Hilco Industrial to sell the machinery and $20 million in raw and finished goods inventory at the 900,000-square-foot plant did not bring in as much money as hoped.
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At the time of the closure, Cardell Cabinetry had debts of $45 million. Compounding its problems, the semi-custom cabinet firm faced penalties of $267,434 for 29 combustible dust and other OSHA violations at its San Antonio, TX, facility.
Founded in 1976, Cardell Cabinetry was acquired by Bill Tidwell in 1977. In 2010 H.I.G. Capital acquired a significant equity stake in the company. The three creditors state in their deposition request they are seeking "documents evidencing any money or funds received by [Cardell CEO Bill] Tidwell and or related entitites that were funded directly or indirectly by the Bank - paid to Tidwell in exchange for transfer of ownership interest to Cardell or Cardell Acquisition," among other financial information.
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