On Friday, February 1, 2008, Plastech Engineered Products, Inc. and certain of its affiliated companies (collectively, “Plastech”) filed for protection under Chapter 11 of the Bankruptcy Code in Detroit, Michigan. None of Plastech's foreign incorporated affiliates are included in this bankruptcy petition and as such, any transaction with such affiliates should continue in the normal course. However, as a result of the bankruptcy filing, an automatic stay is in effect prohibiting creditors from seeking to take action to collect any amounts due to them from Plastech which arose prior to the filing of the bankruptcy petition.
If you are a Plastech supplier who has shipped goods which were received by Plastech within 45 days prior to the Bankruptcy filing, you should consider submitting a reclamation demand in order to recover possession of your products, or, at Plastech's option, receive a higher priority administrative claim as to those goods when compared to a typical unsecured claimant thereby increasing the likelihood of receiving payment. In order to have the court consider such a reclamation demand, you must submit the demand in writing, no later than February 21, 2008; but it is advisable to do so earlier, if possible. In addition, you may be entitled to stop goods in transit in order to increase the likelihood of being paid for those goods. We would be happy to assist you in analyzing your claim and preparing and filing a proper reclamation demand and stopping any goods which may be in transit.
Please note that the filing of the bankruptcy petition by Plastech does not necessarily relieve you from the agreements that you have with Plastech. You may have other options available to you that may minimize your company’s exposure under these proceedings such as modifying payment terms to your benefit; however, this would require a review of your agreements with Plastech.
The above is just a brief, preliminary advisory for informational purposes only and is not intended to replace legal counseling. If you require further information about the filing, have specific questions about your dealings with Plastech or would like our assistance to take action to protect any claims you may have, please feel free to contact us.