Information for Creditors of Speed Industrial Gas, LLC
Case Number 21-51297 in the United States Bankruptcy Court for the Western District of Texas
THE DEBTOR’S HISTORY
Speed Industrial Gas, LLC is “an industrial, welding, and bulk gas company with facilities located in San Antonio and Pleasanton, Texas. The Debtor offers a variety of products and services including in house bulk gas installation and AWS Certified Weld Inspector Services.” This description of the company is according to some of the bankruptcy papers that have been filed on the docket so far.
Speed Industrial appears to be a relatively new company. Its Company Agreement attached to its bankruptcy papers is dated February 24, 2021. The company is owned 100% by Ernest W. “Cotton” Speed III.
In August 2021, the Debtor and several related parties were sued for “(i) violations of the Texas Uniform Trade Secrets Act; (ii) aiding and abetting breach of fiduciary duty (against Mr. Speed only); (iii) tortious interference with contract; (iv) tortious interference with prospective business relations; (iv) conspiracy; and (v) a claim for injunctive relief and attorneys’ fees.” The suit was filed in the District Court of Atascosa County, Texas by Matheson Tri-Gas, Inc. The Debtor has asked that the bankruptcy court take over the case from Atascosa County so that the Debtor can resolve its dispute with Matheson in conjunction with its reorganization.
CONCERNS LINGER FOR CREDITORS
The Bankruptcy Code sets out several requirements and entitlements for parties in bankruptcy cases. Creditors are entitled to certain information from the Debtor, Speed Industrial. While creditors can sometimes feel powerless in bankruptcy cases, it is commonly the case that bankruptcy judges value creditor input and will take what creditors have to say to heart in making decisions impacting the Debtor’s bankruptcy case.
The first hearing in the bankruptcy case is scheduled for Thursday, October 28th at 10am Central. The Court might be inclined to continue this hearing to allow creditors to better understand what the Debtor is asking and assert their positions in favor of or against the Debtor’s requests. However, the Court can only accommodate creditors if they first make their wishes that the hearing be continued known to the Court.
Speed Industrial has asked for several typical and atypical forms of relief. Typical requests include the Debtor’s request for permission to pay employees and taxes. However, other things that the Debtor is seeking are out of the ordinary, including broad, sweeping authority to pay vendors it deems “critical” and permission to extend the automatic stay to the Debtor’s owner, Cotton.
CREDITORS SHOULD ACT FAST TO GET ANSWERS
Prior to the hearing on Thursday, October 28th, creditors should demand additional information from the Debtor. Some questions that the creditors may ask include:
- Who are the Debtor’s top creditors? Where is the list of the Debtor’s creditors who have the 20 largest unsecured claims and are not insiders?
- How much is Matheson claiming in damages in its lawsuit against the Debtor? How much does the Debtor think Matheson might actually recover in the lawsuit?
- What is the Debtor intending to pay its creditors through bankruptcy? Will creditors be paid in full?
- When does the Debtor anticipate proposing a plan in its bankruptcy case? How long will creditors have to wait to be paid what they are owed?
- What is the Debtor’s arrangement with its insider/affiliate, Speedway Investments, and how was that relationship negotiated?
- Is there any property of the Debtor that is unencumbered?
None of this is legal advice; it is a general commentary on information that creditors may want to know. If you have specific questions, please reach out to PRLT today.
PRLT does not represent Speed Industrial Gas, LLC. The content on this page is provided for informational purposes only. Nothing on this page or this website creates an attorney/client relationship between you and PRLT. Nothing on this page is legal advice. If you have any questions about the Speed Industrial Gas bankruptcy case or anything discussed on this page, please contact us.