SAN ANTONIO, TX — Cardell Cabinetry's receiver is suing several companies to recover millions of dollars in overdue payments owed the shuttered cabinet manufacturer.
According to the San Antonio Express, attorney Howard Marc Spector has filed lawsuits "against 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, he said. An auction last month 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, Spector told the San Antonio Express.
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Cardell Cabinetry has closed its doors without warning in September 2013, leaving approximately 900 workers unemployed. 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.
In November, three creditors — Hardwoods of Michigan Inc. in Clinton, MI, Pavco Industries Inc. in Pascagoula, MS, and Valendrawers Inc. of Lexington, NC — filed an involuntary petition under Chapter 7 against Cardell Cabinetry in the Texas Western Bankruptcy Court listing combined claims of nearly $1.1 million. A notice also was filed by creditor Wells Fargo Bank against the cabinetry firm for claims of nearly $17 million.
Cardell also faces a possible class-action lawsuit by former employees for closing the factory without providing 60 days notice as required under the federal Workers Adjustment and Retraining Notification Act, or the WARN Act. Haverford, PA-based law firm Chimicles & Tikellis is investigating the possible suit.
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.
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