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Kodak Execs Seek Millions in Unsecured Claims

Bankruptcy Law

Some Eastman Kodak Co. top executives have joined the ranks of suppliers, communities and individuals saying the bankrupt company owes them big bucks.

In recent days, a handful of Kodak leaders have submitted claims as unsecured creditors. CEO Antonio M. Perez on June 22 entered three claims totaling $18.8 million — one for $1.3 million, one for $1.4 million and one for more than $16 million. Company co-President Philip Faraci on June 18 put in a claim for $348,000 and one for $2.7 million. And Chief Diversity and Community Affairs Officer Augustin Melendez on June 22 submitted a claim for $102,000.

Numerous retired Kodak bigwigs also have filed personal claims against the company, including Edgar Greco, who was vice president and general manager of office imaging when he retired in 1994 and who now has unsecured creditor claims of $1.2 million; and retired corporate vice president Robert LaPerle, who spent more than 32 years with the company and today also has a $1.2 million claim.

Those claims have joined the long and growing list of those who say they personally should be in line for a cut, if and when the Rochester-based printing and imaging company is ever able to pay back its many unsecured creditors. Unlike banks and other lending institutions, unsecured creditors typically do not have claims to any collateral for what they’re owed.

The unsecured creditors claims list now contains more than 3,300 separate claims, including roughly $50 million that Hong Kong digital camera manufacturer AOF Imaging Technology Ltd. says it is owed, $1 million in claims from Rochester Gas & Electric, and $588,000 worth of claims by Rochester sheet metal manufacturing firm AJL Manufacturing.

Kodak spokesman Christopher Veronda said the bulk of those Kodak executive and retired executive claims deal with particular pension obligations for which upper management is eligible.

The company, with its Chapter 11 bankruptcy protection filing in January, eliminated its Kodak Excess Retirement Income Plan and Kodak Unfunded Retirement Income Plan — a pair of supplemental pension plans for highly compensated retirees. Unlike the standard Kodak Retirement Income Plan, whose assets are held in a separate trust, the KERIP and KURIP were paid for directly out of company assets. When Kodak filed for Chapter 11 bankruptcy on Jan. 19, it notified retirees receiving KERIP and KURIP benefits that they were eligible to file claims as unsecured creditors.

Such unsecured creditor claims by current and former executives are not uncommon in a company bankruptcy, as former executives collecting severance or current executives who have deferred compensation all would have unsecured claims, said John C. Ninfo II, who retired recently after 20 years as a U.S. Bankruptcy Court judge for the Western District of New York.

And those claims by company executives can be seen “as a healthy thing in reorganization cases,” said Robert J. Rock, senior bankruptcy attorney with Albany-based law firm Tully Rinckey PLLC. “It suggests that the executives are invested in the reorganization effort and have a tangible benefit if the reorganization is successful.”

More such executive and retired executive claims could be coming soon. The deadline for filing claims regarding unpaid pension plans is July 17.

Bob is the managing partner of the Albany office of Tully Rinckey PLLC and the head of the Firm’s insolvency practice. He has 35 years of experience in dealing with complex financial, corporate and commercial issues. Throughout his 35year legal career, Bob has centered his practice in the Capital Region but has represented clients all across New York including in each of the four United States District Courts and the U.S. Second Circuit Court of Appeals.

Bob has extensive experience before both state and federal courts fighting for clients in the civil litigation arena. When Tully Rinckey PLLC’s clients have been wronged by the action or inaction of another party, they find an ally and advocate in Bob as they pursue their rights in court Clients may also find themselves being sued and in need of the kind of proactive defense provided by Bob and the Tully Rinckey PLLC civil litigation team. Bringing to bear the lessons learned over decades of representing individuals, businesses, non-profit organizations, municipalities, and the full range of legal entities, Bob and the team provide aggressive representation to secure the best possible legal outcome for our clients.

A long-time ally of distressed and troubled businesses and individuals throughout upstate New York, Bob has been expanding Tully Rinckey PLLC’s bankruptcy practice, particularly in the areas of Chapter 11 (business) and Chapter 12 (farm) reorganization while continuing the firm’s tradition of representing individuals in Chapter 7 and Chapter 13 proceedings and all types of bankruptcy litigation.

Bob has successfully confirmed Chapter 11 plans in diverse cases, including a rural Delaware County acute care hospital, a swimming pool builder and water park developer, a major printing company and an ante-bellum ladder manufacturer. He has successfully represented a ski manufacturer in protecting its rights and ensuring that its position was adequately protected in the bankruptcy of a central New York ski area. He has also represented creditors’ committees in a Broome County and Pennsylvania baker, a mid-Hudson building products supplier and a consortium of banks in a case involving a purported investment company behind a massive Ponzi scheme. Bob was the lead attorney on a landmark case involving the eligibility of certain New York partnerships to seek reorganization under Chapter 11. Bob has represented secured and unsecured creditors as well as Chapter 7 and Chapter 11 trustees in virtually every aspect of bankruptcy.

Bob received a juris doctorate from Albany Law School and a bachelor’s degree in political science from LeMoyne College. His admissions include the New York State Bar, the U.S. District Courts for the Eastern, Southern and Northern Districts of New York, and the 2nd U.S. Circuit Court of Appeals.

When not at work, Bob enjoys hiking in the Adirondacks and Catskills, music, local history and travel.



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